Dave Donaldson, APRN – Juneau
Ethan Berkowitz wants to make cuts to a very small portion of the state’s revenue – in exchange for a large return to Alaskan businesses.
The Democrats’ candidate for governor says that reductions to the corporate income tax – less than one percent of the state’s total income – would be balanced by an increase in the number of businesses headquartered in the state and be an economic stimulus. In announcing his plan, Berkowitz said the goal is to make the state less dependent on resource extraction while getting more benefits from the resources themselves.
Berkowitz wants to eliminate all taxes for companies making less than $90,000 a year and reduce the tax rate on larger businesses from 9.4 percent to 4.9 percent. He would also offer tax credits in seven separate categories. He says those incentives include such breaks as credits for companies that are headquartered in the state, that have 100 or more employees, that do research and development in Alaska or that bank in the state.
The corporate income tax is separate from oil, gas and mining taxes and is projected to bring in $80 million in the current year. Berkowitz says that is $20 million less than last year. His reductions and incentives are estimated to cost the state $38 million based on the current tax regime.
Governor Sean Parnell did not directly address Berkowitz’s proposal, but his campaign staff issued a statement criticizing Berkowitz’ opposition to federal tax cuts, and his opposition to tax cuts for the oil industry.
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