Berkowitz aims to shrink corporate income taxes
Anchorage Daily News - September 21, 2010
Ethan Berkowitz wants to replace the existing 9.4 percent tax bracket for those making more than $90,000 with a tax of 4.9 percent. The changes would not apply to oil, gas, mining or fishing enterprises. Of almost 13,800 non-oil or -gas corporate filers in 2009, more than 11,000 paid no taxes under the current structure, according to a state report provided by Berkowitz, who said plenty of businesses would still benefit.
"We're sweeping clear the bottom tier of taxpayers," the former state lawmaker said at a news conference with the lieutenant governor nominee, Diane Benson.
The projected $38.4 million revenue loss represents less than 1 percent of Alaska's $5 billion budget, according to Berkowitz.
He said the state could more than compensate by encouraging investment in Alaska through tax credits for corporate commitments such as hiring more Alaskans, setting up headquarters here or developing renewable energy or design technologies.
"We believe that if you change the economic conditions that face companies attempting to do business in this state, we can encourage more businesses to come to Alaska, create more jobs in Alaska and do more things for our future to help diversify the economy," Berkowitz said.
Alaska's top corporate income tax rate is among the highest in the nation -- ahead of high tax burden states such as California, New Jersey and New York. Berkowitz said his proposal would make Alaska's corporate tax rate the 8th lowest.
Asked to comment on the ideas unveiled Tuesday, Gov. Sean Parnell's campaign manager Michelle Toohey said Berkowitz is a tax-and-spend politician -- "plain and simple" -- who had supported, for example, higher taxes on the oil industry.
"I'm reminded of that old gameshow 'To Tell the Truth' and need to ask, 'Will the real Ethan Berkowitz please stand up?'" Toohey said in a statement.
The state of Alaska's economy is a continuing theme in this year's governor race. Parnell, a Republican trying to win his first full term as governor, says he's doing plenty for business, including pushing for $100 million in state maintenance projects, supporting oil tax credits and cruise ship head tax cuts, and backing natural gas tax credits for exploration and storage in Cook Inlet.
The tax proposals are the third part of Berkowitz's "Alaskan Ownership Stake" platform. He said he plans to announce other ideas before the November general election.
Berkowitz also is pushing for the sale of lifetime fishing, hunting and trapping licenses for Alaskans. He also says Alaskans also should have the opportunity to invest in a proposed natural gas pipeline.
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