Winter sales tax returns to Soldotna

Soldotna’s year-round sales tax on nonprepared food items is back on the books.

Soldotna City Council members unanimously voted at their Wednesday meeting to enact an ordinance that will reinstate the grocery tax during winter months — there is already a 3 percent sales tax on nonprepared foods in summer months.

Since Soldotna became a home-rule city after a majority of residents voted to accept a home-rule charter during the October election, it gained the power to opt out of the wintertime exemption on collecting the sales tax that is observed at the Kenai Peninsula Borough level. Kenai is another home-rule city that has opted out of the exemption and collects the tax year-round.

Members of the public turned out Wednesday to testify for and against reinstating the tax, with some saying that it will spread the burden of raising revenue more evenly throughout the borough and others arguing that it will disproportionately affect those with lower incomes.

Council members said that, without the sales tax on nonprepared foods, the city would have to look at raising property taxes to make up the lost revenue.

The ordinance will take effect Dec. 1 of this year, rather than immediately upon its enactment as originally stated in the ordinance, so as to allow businesses and the borough more time to prepare for the switch. The date change amendment was brought forward by Vice Mayor Linda Murphy.

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