State of Alaska
Fiscal Note
Bill Version: SCS HB 90(TRA)
2022 Legislative Session
Fiscal Note Number: 5
(S) Publish Date: 5/4/2022
Identifier: HB090AM(EFD FLD)-DOR-TAX-3-25-22 Department: Department of Revenue
Title: VEHICLE RENTALS & VEHICLE RENTAL Appropriation: Taxation and Treasury
NETWORKS Allocation: Tax Division
Sponsor: WOOL OMB Component Number: 2476
Requester: (S) Transportation
Expenditures/Revenues
Note: Amounts do not include inflation unless otherwise noted below. (Thousands of Dollars)
Included in
FY2023 Governor's
Appropriation FY2023 Out-Year Cost Estimates
Requested Request
OPERATING EXPENDITURES FY 2023 FY 2023 FY 2024 FY 2025 FY 2026 FY 2027 FY 2028
Personal Services
Travel
Services
Commodities
Capital Outlay
Grants & Benefits
Miscellaneous
Total Operating 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Fund Source (Operating Only)
None
Total 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Positions
Full-time
Part-time
Temporary
Change in Revenues
None *** *** *** *** *** ***
Total *** 0.0 *** *** *** *** ***
Estimated SUPPLEMENTAL (FY2022) cost: 0.0 (separate supplemental appropriation required)
Estimated CAPITAL (FY2023) cost: 0.0 (separate capital appropriation required)
Does the bill create or modify a new fund or account? No
(Supplemental/Capital/New Fund - discuss reasons and fund source(s) in analysis section)
ASSOCIATED REGULATIONS
Does the bill direct, or will the bill result in, regulation changes adopted by your agency? Yes
If yes, by what date are the regulations to be adopted, amended or repealed? 07/31/22
Why this fiscal note differs from previous version/comments:
Updated to include House amendments to the bill that created two separate passenger vehicle rental tax rates for "vehicle rental
businesses" and "vehicle rental individuals", and dropped the effective date provision. Updated fund code to reflect indeterminate
revenue impact to the Vehicle Rental Tax account in the General Fund.
Prepared By: Nicole Reynolds, Deputy Director and Dan Stickel, Chief Economist Phone: (907)269-6736
Division: Tax Division Date: 03/25/2022 04:30 PM
Approved By: Eric DeMoulin, Administrative Services Director Date: 03/25/22
Agency: Department of Revenue
Printed 5/4/2022 Page 1 of 2 Control Code: FWdPP
 SCS HB 90(TRA) - Fiscal Note 5
FISCAL NOTE ANALYSIS
STATE OF ALASKA BILL NO. HB 90
2022 LEGISLATIVE SESSION
Analysis
Background
Under AS 43.52, Alaska currently imposes an excise tax on the lease or rental of passenger and recreational vehicles in the
state if the lease or rental of the vehicle does not exceed 90 consecutive days. The rate of the tax for passenger vehicles is
10% of the total fees and costs charged for the lease or rental of the passenger vehicle. The rate of the tax for recreational
vehicles is 3% of the total fees and costs charged for the lease or rental of the recreational vehicle. Current statutes
provide a limited ability to enforce the tax on private vehicle rentals.
This bill would create two separate passenger vehicle rental tax rates for vehicle rental businesses and vehicle rental
individuals. Vehicle rental businesses would be subject to a 10% tax on total fees and costs charged for the lease or
rental of a passenger vehicle. Vehicle rental individuals would be subject to an 8% tax on total fees and costs charged for
the lease or rental of a passenger vehicle. The bill defines vehicle rental business as a person who (A) engages in the
business of renting a vehicle in the state, or through a vehicle rental network, arranging or executing a vehicle rental in
the state, and (B) rents four or more vehicles in the state. The bill defines vehicle rental individual as a person who (A)
engages in the business of renting a vehicle in the state, or through a vehicle rental network, arranging or executing a
vehicle rental in the state, and (B) rents three or fewer vehicles in the state.
Persons who provide the leased or rented vehicle, or vehicle rental businesses or vehicle rental individuals that arranged
or executed the rental through the vehicle rental network would be responsible for collecting the tax and remitting it to
the Department of Revenue (Department). The bill sponsor's intent is for the online or virtual peer-to-peer vehicle rental
platforms to collect and remit the tax.
This bill may have the effect of expanding the taxpayer base of the vehicle rental tax and bringing additional revenue into
the general fund which is classified as Designated General Fund (DGF) revenue.
The provisions of this bill would take effect 90 days after the bill is signed into law since this bill does not provide for an
effective date. For purposes of this bill, it is assumed the bill would become effective on August 1, 2022.
Revenue Impact
The revenue impact of this bill is indeterminate as the Department has limited data on peer-to-peer rentals in Alaska and
would need to make many assumptions to come up with an estimated revenue impact. The Department has collected an
average of $10.9 million in vehicle rental taxes over the past four years. In FY2019, the revenue from the vehicle rental tax
was $11.4 million. In FY2020, the revenue from the vehicle rental tax was $9.7 million. In FY2021, the revenue from the
vehicle rental tax was $7.9 million. This bill may expand the taxpayer base of the tax and, therefore, would likely have a
positive effect on revenue.
Implementation Cost
This bill changes the passenger vehicle tax rates, creates two separate classes of people who rent passenger vehicles, and
expands the tax base. However, this bill would not require the Department to make significant changes to its Tax Revenue
Management System (TRMS). Therefore, there would be no cost to the Department for implementation. Additional
review and audit work would be absorbed by existing staff.
(Revised 11/23/2021 OMB/LFD) Page 2 of 2
HB090AM(EFD FLD)-DOR-TAX-3-25-22 Page 2 of 2 Control Code: FWdPP


Statutes affected:
HB0090A, AM HB 90, introduced 02/18/2021: 43.52.050, 43.52.010, 43.52.099, 45.45.459, 19.75.915, 28.10.375, 28.35.320, 45.45.425, 45.45.430, 45.45.450, 45.45.455
HB0090B, AM HB 90 am(efd fld), introduced 03/02/2022, passed House 03/18/2022: 43.52.020, 43.52.010, 43.52.050, 43.52.099, 45.45.459, 19.75.915, 28.10.375, 28.35.320, 45.45.425, 45.45.430, 45.45.450, 45.45.455
HB0090C, AM SCS HB 90(TRA), introduced 05/04/2022: 43.52.020, 43.52.010, 45.45.459, 43.52.050, 43.52.099, 43.52.090, 19.75.915, 28.10.375, 28.35.320, 45.45.425, 45.45.430, 45.45.450, 45.45.455
HB0090A, AM HB 90, introduced 02/15/2021: 43.52.050, 43.52.010, 43.52.099, 45.45.459, 19.75.915, 28.10.375, 28.35.320, 45.45.425, 45.45.430, 45.45.450, 45.45.455