State’s highest court allows property tax on oil to stand

by The Associated Press

The Alaska Supreme Court has resolved a two-decades-old legal argument over how communities tax the oil industry. The decision sided with the North Slope Borough and the City of Valdez.

Ketchikan had challenged the method the two communities have used since 1978 that allows them to combine local property with oil company property in determining local taxes.

Ketchikan later dropped the case, but an individual, Donald Bullock, kept it alive. He claimed it was unfair to the rest of the state, because local taxes are deductible when it comes to paying state taxes.

Bullock contends this meant a larger part of the tax should go to state government.

Alaska’s highest court, however, allowed the practice to stand.

The panel ruled the method the state has used on the North Slope and in Valdez is “continuous, long-standing, and not arbitrary or capricious.”