Juneau committee to weigh 10% tax on rental cars staged near cruise docks

A 10% excise tax on vehicle rentals that begin near Juneau's cruise ship docks goes before the Assembly's Committee of the Whole at 6 pm Monday. Under the draft ordinance, the renter pays and the lessor, host or platform collects.

The problem it targets is parking. Staged rental vehicles occupy subsidized public parking downtown, Deputy City Manager Robert Barr wrote to Deputy Mayor Greg Smith, estimating 20 to 30 peer-to-peer vehicles a day in the Marine Parking Garage each summer plus another 10 in surface lots. Peer-to-peer means owners renting out their own cars through a platform. Barr also cited complaints about on-street staging near the rock dump. Monthly-permit waitlists continue at the garage and the Downtown Transit Center.

The zone covers public streets and lots within roughly a half mile of the AJ Dock, Franklin Dock, Cruise Ship Terminal, Alaska Steamship Dock and Marine Park. Since March it has grown to take in the bottom of the rock dump and the IGA parking lot.

Staff recommend settling the geographic question rather than the business-model one. Traditional companies usually stage on private lots; peer-to-peer hosts usually stage on public property. "Because usually is not always, using a business model distinction runs the risk of taxing or exempting the same vehicle in the same stall, depending on how it is booked," Barr wrote. The choice turns on whether downtown congestion alone justifies taxing a rental that uses no public parking. Green Alaskan Car Rentals, a traditional operator, tells customers "parking downtown is very restricted, so we use the Marine Way Parking Garage" for pickups.

The tax would stack on top of an already tall pile. The state taxes traditional rentals at 9% and peer-to-peer rentals at 7%, with a 5% city sales tax on top — currently 14% and 12%. The new excise tax would push those to 24% and 22%. Treasury collects sales data only, so staff have no revenue estimate and no count of vendors inside the zone. Juneau handled about 1.7 million cruise passengers in 2025.

No public testimony will be taken Monday. Staff are asking committee members whether the legislation needs more work or is ready for introduction.