I sent the material below to a number of Anchorage legislators earlier this week, and Andy Josephson asked me if I would share it with you. My point in sending this to the legislators was that while it seems that one and all in Juneau talk about wanting to hear from the public, the public statements of those asking for input seem to reflect little of what passes for what is discussed on the street. In the meantime, we are bombarded by schemes that most see as dubious at best, and all lacking much in the way of documentation, modeling, etc. If you want to make an impression on concrete learners, you have to come up with some manipulables…
Folk on the street elected our Governor because they had had enough of Parnell. I think they would have elected a gorilla if they had to, meaning no disrespect to Governor Walker. And now, the Governor has another chance to repudiate the policies that Parnell championed, and the people of this State are ready to rally around the Governor, as they rallied round him with respect to Medicaid Expansion.
The fact is that most Alaskan make no net payment for any State or Local service. Period. Moreover, those who do pay a little something are 1%ers, and frankly can afford paying their way. Alaskans can afford MORE than a 15% nominal tax and we insist, across the board, on our willingness to raise taxes on ourselves to maintain the quality of life we enjoy as long as the taxes are not wasted. Let’s get to taxing!
Thanks for reading,
Please review this Google Doc spreadsheet . It provides a brief examination of the revenue that a 15% nominal graduated income tax might generate on its own. [the spreadsheet has been embedded below to make it easier for the reader]
As State Income Taxes and Local Realty Taxes are deductible from Federal Tax, the total tax burden on “middle class” Alaskans would rise only a few points. As noted this basic analysis uses SOI brackets for ease of gross computation; actual brackets could be significantly skewed placing a greater burden on those itemizing.
Additionally, however, if we use a State Income Tax as a tool by which we can leverage other taxes we can also look at half a billion gallons of fuel used on the highway annually (about half gasoline and half diesel), and if we impose a $6/gallon tax, and then exempt first 100 gallons per household for 261,000 households we get another half a billion in revenue (yes, prices of shipped goods will rise across the board, which makes it more economical to buy local….) AND then we need to add the tax to private non-commercial airplane fuel
Lastly, removing the booze excise tax and replacing it with a retail tax starting at a dime per mL of actual ethanol, as in a 750 ml bottle of liquor at 100 proof might produce .48 (ABV)* 750 (mL) *$1 (tax) * .1 (multiplier) = $36 for a fifth of booze. Likewise a 750 ml bottle of wine would produce .13*750*$1*.1=$9.75 on a bottle of wine, and even after a modest exemption for a gallon a month, we have added another chunk of change and a real complement to a marijuana tax.
Now, repeal SB21 and dump all industry subsidies, and we are pretty close to being self-sufficient
Let’s put an end to the whine of the middle class welfare queens. Let’s put an end to the silly chatter about economic deportation of seniors, and let’s recognize that the median income in Alaska is over $70K (over $80K in urban Alaska), and Alaskans not only can pay their way, they have repeatedly told the focus group held by far right ideologues that they are WILLING to pay the taxes necessary to maintain their quality of life.
Stop talking about playing with the PFD: that is simply a shell game as any economist will tell you. The PFD – except in the Unorganized Borough, which is another matter altogether – is simply an in lieu transfer; PFD’s, while they provide an interim multiplier effect, also underwrite most of Municipal taxation on resident populations.
Stop talk about tapping reserves, as we all know legislators can’t be trusted in the hen house.
Promote a comprehensive tax regime that will meet Alaska’s real budget requirements.