The governor, facing a profound fiscal crisis, has proposed the imposition of a personal income tax for the first time in 35 years. State lawmakers, who recently moved into a palatial new office building here, where they work when not toiling in the far-off Capitol in Juneau, are now seeking less costly digs.
And a state budget that was a point of Alaskan pride — and envy from around the nation — lies in tatters as revenue that flowed from selling crude oil from Prudhoe Bay over the past four decades has been swept away.
With oil prices down along with oil production, the state is facing an Alaska-size shortfall: Two-thirds of the revenue needed to cover this year’s $5.2 billion state budget cannot be collected.
Many Alaskans are not old enough to recall times this bad. This is the nation’s least-taxed state, where oil royalties and energy taxes once paid for 90 percent of state functions. Oil money was so plentiful that residents received annual dividend checks from a state savings fund that could total more than $8,000 for a family of four — arriving each autumn, as predictable as the first snowfall.
With every barrel of oil, the state collected a royalty and a production tax that paid for most of state government and the creation of a multibillion-dollar Permanent Fund savings account
The fund has paid dividends to residents every year since 1982, from $300 to $500 a person in the early years to more than $2,000 this year, based on the fund’s investments.
Mr. Walker’s recovery plan would take more from residents through the income tax and would give them less as well, by changing the formula under which the dividend is paid. The income tax would be 6 percent of the amount an Alaskan currently pays in federal taxes, so a person who owed $10,000 to the Internal Revenue Service would also need to write a $600 check to Alaska.
more..
http://www.nytimes.com/2015/12/26/u...=Full®ion=Marginalia&src=me&pgtype=article
And a state budget that was a point of Alaskan pride — and envy from around the nation — lies in tatters as revenue that flowed from selling crude oil from Prudhoe Bay over the past four decades has been swept away.
With oil prices down along with oil production, the state is facing an Alaska-size shortfall: Two-thirds of the revenue needed to cover this year’s $5.2 billion state budget cannot be collected.
Many Alaskans are not old enough to recall times this bad. This is the nation’s least-taxed state, where oil royalties and energy taxes once paid for 90 percent of state functions. Oil money was so plentiful that residents received annual dividend checks from a state savings fund that could total more than $8,000 for a family of four — arriving each autumn, as predictable as the first snowfall.
With every barrel of oil, the state collected a royalty and a production tax that paid for most of state government and the creation of a multibillion-dollar Permanent Fund savings account
The fund has paid dividends to residents every year since 1982, from $300 to $500 a person in the early years to more than $2,000 this year, based on the fund’s investments.
Mr. Walker’s recovery plan would take more from residents through the income tax and would give them less as well, by changing the formula under which the dividend is paid. The income tax would be 6 percent of the amount an Alaskan currently pays in federal taxes, so a person who owed $10,000 to the Internal Revenue Service would also need to write a $600 check to Alaska.
more..
http://www.nytimes.com/2015/12/26/u...=Full®ion=Marginalia&src=me&pgtype=article
