Legislature(2015 - 2016)

2016-01-19 Senate Journal

Full Journal pdf

2016-01-19                     Senate Journal                      Page 1599
SB 134                                                                                                                        
SENATE BILL NO. 134 BY THE SENATE RULES COMMITTEE                                                                               
BY REQUEST OF THE GOVERNOR, entitled:                                                                                           
          "An Act relating to the taxation of income of                                                                         
          individuals; repealing tax credits applied against the                                                                
          tax on individuals under the Alaska Net Income Tax                                                                    
          Act; and providing for an effective date."                                                                            
was read the first time and referred to the Labor and Commerce and                                                              
Finance Committees.                                                                                                             

2016-01-19                     Senate Journal                      Page 1600
The following fiscal information was published today:                                                                           
 Fiscal Note No. 1, Department of Revenue                                                                                       
Governor's transmittal letter dated January 15:                                                                                 
Dear President Meyer:                                                                                                           
Under the authority of Article III, Section 18 of the Alaska                                                                    
Constitution, I am transmitting a bill relating to personal income                                                              
The bill would establish a personal income tax equal to six percent of                                                          
a taxpayer's total federal tax liability for Alaska residents and                                                               
nonresidents with income from a source in the state. Because the tax                                                            
that would be established by the bill is calculated based on federal tax                                                        
liability and not on income, the bill effectively incorporates federal                                                          
brackets and exemptions and so permits this bill, and the Alaska                                                                
personal income tax system it would create, to be as simple and                                                                 
transparent as possible and minimizes administrative burdens both for                                                           
the state and for taxpayers. The bill would apply to income earned on                                                           
or after January 1, 2017. In addition, the bill would repeal a set of                                                           
orphaned individual tax credits from the former income tax.                                                                     
The relatively modest tax is expected to raise approximately                                                                    
$200,000,000 annually. For those who itemize federal tax deductions,                                                            
the tax would be deductible from federal income tax. The deduction                                                              
from federal taxes would offset the actual burden of this tax to Alaska                                                         
taxpayers by 20 - 25 percent.                                                                                                   
The bill is an integral component of the New Sustainable Alaska Plan                                                            
to provide a balanced and sustainable budget for Alaska's long-term                                                             
fiscal stability.                                                                                                               
I urge your prompt and favorable action on this measure.                                                                        
Bill Walker