In 2002 the City adopted a sales tax to include a tax on the sale of real property within the City as provided in Bethel Municipal Code 4.16.040(Y), which states:
“That portion of the selling price of real property in excess of twenty percent of the first $375.000 of the selling price is exempt. This exemption does not apply to rentals of real property. This exemption applies to all sales of real property including casual and isolated sales.”
At the 2002 meeting a Council Member made a motion to reduce the amount subject to the tax from $375.000 to $275.000. The motion passed four to one. When BMC 4.16.040(Y) was published in the Bethel Code, the amount of $375,000 was inadvertently left in the formula to calculate the amount of tax a seller of real property would owe at the time of the transaction. This manifest clerical error apparently remained in the Code since 2002 with the City collecting over-payment from sale transactions involving real property in the City from some tax payers over the years.
This inadvertent manifest clerical error was discovered by the City Attorney’s Office who was performing research of the Code and Legislative history of the sales tax ordinance. Upon learning of this problem, the City commenced developing a remedial program to refund the over-payments to individuals involved in real property transactions who overpaid the sales tax based on the error. Based on the foregoing a remedial ordinance to establish a refund program for eligible individuals will be presented to Council on March 22, 2016.
The Council adopted Ordinance 16-09, authorizing the refund program on April 12, 2016. This document will become available after signature.
For more information please contact:City Attorney, Patty Burley
300 State Highway
PO BOX 1388
Bethel, Alaska 99559