House Majority Forces Unnecessary "Tax Working Alaskans Act"
Democrats tax Alaskans, drag economy further into recession
Saturday, April 15, 2017, Juneau, Alaska – Today, House Republicans stood resolutely against an income tax, while the House Democrat-led Majority voted to take over $680 million from Alaskans by passing House Bill 115. HB 115, which would more aptly be called the "Tax Working Alaskans Act," would tax Alaskans' income, including pensions of elder Alaskans, ANCSA Corporation shareholder dividends, and trusts. Sixty new state employees, at an estimated annual cost of over $7.5 million, would be hired to impose this tax.
"Taxing Alaskans is fundamentally the wrong thing to do during an economic recession," said Representative Lance Pruitt, R-Anchorage. "Over 9,000 Alaskans have lost their jobs in the last year. We've heard from economists that another 7,500 jobs will be lost in 2017. The House Majority's income tax will make these numbers worse, and make it harder for Alaskans already struggling to make a living."
"This bill has changed every other week and has no modelling," said Representative Mike Chenault, R-Nikiski. "Do we want to be more like the federal government, where we have to pass a bill to find out what is in it? An income tax is not needed to close our fiscal gap, and is not wanted by Alaskans."
A March 2017 poll commissioned by the Alaska Chamber of Commerce demonstrated that 58 percent of Alaskans oppose imposing an income tax to fill the state's budget deficit. As it currently stands, HB 115 will tag Alaska with the unfortunate title of having the 12th highest marginal tax rates in the United States. No modelling was performed on the version of HB 115 voted on today. It is unknown how this income tax would impact economic growth, job creation, business investment, unemployment, Alaska or its residents.
"There are at least four plans out there that address our fiscal gap without taxing Alaskans," said Representative Charisse Millett, R-Anchorage. "Why in the world would we tax Alaskans if we don't have to?"
"Taxing Alaskans who work to give free state services to those who don't is simply the wrong policy," said Representative Dan Saddler, R-Eagle River. "The better policy is to shrink government, cap spending, and encourage the private sector to build new wealth."
Fiscal plans introduced by House Republicans, which included no taxes, have not received any hearings to date, and Republican House Finance members were denied the opportunity to reduce the impacts of this bill on Alaskans.
House Bill 115 passed 22 to 17 and now heads to the Senate for consideration.
For more information contact Rep. Millett's office at 907-465-3879 or email staffer Grace.Abbott@akleg.gov