1. Sales of real property and interest in real property.

2. Casual and isolated sales of goods or services and not made in regular course of business, e.g., garage sales.

3. Sales of securities, insurance and bonds of guaranty, fidelity and surety.

4. Gross receipts or proceeds derived from funeral charges and services.

5. Gross receipts or proceeds derived from the transportation of students to and from grade or high schools in motor or other vehicles.

6. Sales of food in cafeterias or lunchrooms in elementary, secondary or post-secondary schools that are operated primarily for the convenience of school students and faculty and not operated for profit.

7. Sales or services which the municipality is prohibited from taxing under the laws of the state or under the laws of the United States.

8. Sales of newspapers or other periodicals.

9. Sales, rentals and services by or to the United States government, the state of Alaska, or any of their agencies, instrumentalities or any political subdivisions and federally recognized Indian tribes. This exemption does not apply to the following:

10. Dues or fees to nonprofit clubs, labor unions or fraternal organizations.

11. Sales of admission to school entertainments, school athletic events and activities conducted for charitable purposes or community benefits. Retail sales by a school-sanctioned activity group raising funds for its approved purpose. This exemption does not apply to sales of gaming.

12. Bulk sale of feed, seed and fertilizer to farmers.

13. Sales of air, train, boat, cruise line or bus tour transportation, car rentals, accommodations, or admission to entertainment events, where the service is provided outside the city, and fees or commission related to such sales.

14. Sales related to orbital space facilities, space propulsion systems, space vehicles, satellites or stations, to the extent of the exemption required by AS 29.45.650(h).

15. Medical services.

16. Medical equipment and supplies prescribed by a health care provider licensed to practice in the state of Alaska. Sales and rentals of hearing aids, crutches, wheelchairs and personal apparatus specifically manufactured for a patient.

17. Prescription drugs for human consumption prescribed by a health care provider licensed to practice in the state of Alaska.

18. Food coupons, food stamps and other allotments issued under 7 U.S.C. 2011 through 2036 (Food Stamp Program) or food instruments, food vouchers or other type of certificate issued under 42 U.S.C. 1786 (Special Supplemental Food Program for Women, Infants and Children).

19. Gross receipts or proceeds received by those schools that comply with AS 14.45.100 through 14.45.130, to include religious schools and other private schools, that are derived from the provision of educational services to children at least five years of age; provided, however, such gross receipts or proceeds for other services, to include without limitation, education services to children less than five years of age and day care for children of any age, are not exempt from the tax, except to the extent such comparable services are provided for free by the Matanuska-Susitna Borough School District to children similarly situated.

20. U.S. postage; and shipping and freight hauling services that originate in the city, but the end destination is outside the city limits. Excluding warehouse, storage services, and delivery services that begin and end within the city.

21. Sales of transportation service by taxicabs, limousine companies, and rideshare companies.

22. Sales of goods and services provided under warranty or service contract, whether performed by the manufacturer or authorized representative of the manufacturer, and charged to a third-party warrantor for repairs, major maintenance, or both. The initial purchase of warranty or service contract would be taxed at the time of purchase. Any portion of repair paid by the customer through a deductible or other means would not be exempt under this section.

23. The following sales and services by banks, savings and loan associations, credit unions and investment banks:

24. Sales of all fuel products at the Warren “Bud” Woods Palmer Municipal Airport.

1. Sales to wholesale or retail dealer in the property sold, for the purpose of resale by the dealer located or making sales inside the city and registered with a city business license.

2. Sales of raw material to manufacturer located or making sales inside the city and registered with a city business license, which raw materials become an ingredient or component part of a manufactured product or container thereof or are consumed in the manufacturing process.

3. Sales of tangible personal property that either will be consumed in the course of construction or become part of real property, and rentals of equipment or services by a licensed contractor under AS 8.18, to an owner of real property for use in the original construction of, or renovations to, improvements to real property located in the city. This exemption does not apply to sales of tangible personal property, or rentals of equipment, that are to be used in the repairing or maintaining of real property.

4. Sales of tangible personal property that either will be consumed in the course of construction or become part of real property, and rentals of equipment or services by a licensed contractor under AS 8.18, to a person licensed as a contractor under AS 8.19 for use in the original construction of, or renovations to, improvements to real property. The exemption does not apply to sales of tangible personal property, or rentals of equipment, that are to be used in repairing or maintaining real property.

5. Sales of food supplies to cafes, restaurants and other establishments where food is sold to the public for use in the normal course of business of cafes, restaurants and other food service establishments.

6. Sales of food supplies to hospitals, institutions housing six or more residents, recreational camps and schools located inside the city and registered with a city business license.

7. Sales, rentals and services to a church that is organized as a nonprofit corporation under the laws of the state of Alaska.

8. Services sold for resale when the services are directly integrated into services or goods sold by the buyer located within the city and registered with a city business license to another purchaser in the normal course of business; provided, that the services are purchased separately for resale, and the services are identified, charged for and billed separately without markup from any other services.

9. Sales, services and rentals to a person that the Internal Revenue Service recognizes as an organization described in Section 501(c)(3) or 501(c)(4) or 501(c)(6) of the Internal Revenue code; provided, that the sale, rental or service is not for use in an “unrelated trade or business” of the person, as the term is defined in Section 513 of the Internal Revenue Code .

10. Sales, services and rentals made by a person that the Internal Revenue Service recognizes as an organization described in Section 501(c)(3), 501(c)(4) or 501(c)(6) of the Internal Revenue Code; provided, that this exemption does not apply to the following: