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State polishes oil tax cut arguments ahead of legislative session
Becky Bohrer Associated Press
Alaska’s Revenue Department is working to strengthen the Parnell administration’s argument for cutting oil production taxes.
Revenue Commissioner Bryan Butcher said that since the Legislature adjourned, considerable work has gone into studying how Alaska’s tax structure compares to those of similar jurisdictions, like North Dakota and Alberta, Canada. He said the focus should be on places that face production challenges similar to Alaska’s, not on places like Iraq or on states with very little production.
The analysis so far bolsters Gov. Sean Parnell’s position that Alaska’s tax structure is out of whack, Butcher said.
The tax debate is expected to resume when the Legislature returns in January, but the administration must win over senators, who earlier this year refused to act on Parnell’s tax-cut plan, saying they didn’t have the information necessary to make a sound policy call.
Wielechowski doubtful Sen. Bill Wielechowski, D-Anchorage and vice-chair of the Senate Resources Committee, said he hasn’t heard of “any new, persuasive arguments being made” that would sway many minds; he himself doesn’t consider the current tax structure broken. “It’s just the same old arguments,” he said. “I don’t think that will be enough to get it through the Senate.”
Wielechowski said the proposal, as it stands now, probably wouldn’t even get past the Resources Committee, one of three it likely will need to get through to get a vote by the full Senate. The Senate Labor and Commerce Committee recently held hearings on North Slope and oil industry jobs, but no hearings have been held during the interim on the tax proposal itself.
The House passed a version of Parnell’s tax cut bill during the last regular session.
Revenue criticized It was during that session that some lawmakers criticized Butcher’s department as not being as prepared as it should have been to pitch a plan that could have a significant impact on state revenues. Butcher was confirmed as commissioner — after floor debate, which is unusual for appointees of the governor — in April.
Butcher said he looks forward to laying out for lawmakers the information the department has, which he said makes clear that Alaska’s tax rate is high. He and Parnell have each stood behind the governor’s proposal for changing the tax regime but have also expressed an openness to entertain other ideas so long as they boost production and investment.
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