00                      CS FOR SENATE BILL NO. 137(STA)                                                                   
01 "An Act imposing a tax on employment; and providing for an effective date."                                             
02 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
03    * Section 1.  AS 43 is amended by adding a new chapter to read:                                                    
04                        Chapter 45.  Education Tax.                                                                    
05            Sec. 43.45.011.  Tax imposed.  There is imposed a tax of $100 a year on each                               
06       individual 19 years of age or older who, during the entire tax year, receives                                     
07       compensation greater than $1,000 in the state.                                                                    
08            (b)  For purposes of this section, "compensation" includes wages, salaries,                                  
09       commissions, tips, and any other form of remuneration paid for personal services.                                 
10            (c)  The tax imposed under this section does not apply to compensation exempt                                
11       from the tax under federal law.                                                                                   
12            Sec. 43.45.021.  Collection of tax.  (a)  An employer shall deduct and                                     
13       withhold $50 of the tax from the employee's salary or other compensation on each of                               
14       the first two regular payrolls after the employee's total compensation paid by the                                
15       employer during the tax year has exceeded $1,000.  An employer shall file a return on                             

01       a form prescribed by the department and send the tax withheld to the department on or                             
02       before the fifteenth day of the month following the month in which the tax was                                    
03       withheld from the employee.                                                                                       
04            (b)  A deduction of the tax may not be made in the salary or other                                           
05       compensation of an individual who provides proof to the employer that                                             
06                 (1)  the tax imposed under AS 43.45.011 for that tax year has already                                   
07       been withheld by another employer; or                                                                             
08                 (2)  the individual was not 19 years of age or older for the entire tax                                 
09       year.                                                                                                             
10            (c)  An individual who has not had the full tax withheld by an employer must                                 
11       file a return on a form prescribed by the department and remit the tax due under this                             
12       section by June 30 of the tax year.                                                                               
13            Sec. 43.45.031.  Liability of employer.  An employer who pays compensation                                 
14       is liable for the tax required to be withheld from an employee under this section unless                          
15       the employer can demonstrate that the employer relied on proof provided by the                                    
16       employee that                                                                                                     
17                 (1)  the tax imposed under AS 43.45.011 had already been withheld by                                    
18       another employer; or                                                                                              
19                 (2)  the individual was not 19 years of age or older for the entire tax                                 
20       year.                                                                                                             
21            Sec. 43.45.041.  Disposition of tax proceeds.  (a)  The tax collected by the                               
22       department under AS 43.45.021 shall be deposited into the general fund and accounted                              
23       for separately.                                                                                                   
24            (b)  The legislature may appropriate the estimated amounts to be collected and                               
25       separately accounted for under (a) of this section for education.                                                 
26            (c)  The deposit required and appropriation authorized by this section are not                               
27       intended to create a dedication in violation of art. IX, sec. 7, Constitution of the State                        
28       of Alaska.                                                                                                        
29            Sec. 43.45.051.  Definition.  In this chapter, "tax year" means the period                                 
30       beginning on July 1 and ending on June 30 of the following calendar year.                                         
31    * Sec. 2.  This Act takes effect July 1, 2003.