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10/28/2017
Revenue

It’s difficult to gain public support for a new tax. However, some elected state officials are using the words: Income tax.

Gov. Bill Walker welcomed the Legislature back into special session this week — for the fourth time this year — to deal with the state’s $2.5 billion budget deficit.

The deficit came about with a significant decline in oil prices — from over $100 to about $50 per barrel.

Oil production had been on the decrease, but the state has increased its oil production expectations for 2017 and oil companies are announcing increases, as well. None of those changes will even begin to eliminate the deficit immediately.

Walker and the Legislature have been struggling to address the deficit. Walker and the House view a new tax as integral to the solution. The Senate has remained steadfast, seeking greater budget cuts.

Whether the two chambers will come to a deficit pact in this latest special session is hopeful thinking.

No elected official wants to impose a new tax.

But before the state began reaping the benefits of oil revenue, it had an income tax.

Most Alaskans worry that if a tax is imposed now it would be eternal.

Alaska has proven that isn’t true. It ended the income tax decades ago when it started receiving oil revenue.

If Alaska did it once, then it could do it again.

The state must ensure it has cut the budget to the point that Alaskans are satisfied Alaska government is the very leanest, and that cuts are indeed cuts and not movement of revenue from one department to another. Then legislators might get away with re-implementing the income tax.

If they do, it should have a sunset date, and it should take a super majority in both legislative chambers to extend it.

But Alaskans aren’t there yet. If they were, the Legislature would have implemented the tax only weeks ago in one of the other special sessions.

It didn’t happen.