The governor’s budget proposal is an existential threat to Alaska’s economy and the people it serves. Legislators, business owners and civic leaders need to respond with authority and leadership. It’s time for everyone to step up to the plate with a firm counter-proposal to generate revenue. A good first step is to institute a statewide room-and-meals tax and an income tax tied to the federal code.
Rooms and meals, also know as a “bed tax,” is an easy decision. Almost two million visitors come to Alaska every year. Travelers are used to this tax no matter where they journey. Alaska could institute an 11 percent tax and few travelers would care about the difference.
An income tax just makes sense. Despite anyone’s fears, state income taxes are far less burdensome than many folks might assume. Thirty-seven states tie their state income tax to the federal code. If you get a refund on your federal tax return, you will get a refund on your state return, too.
I’ve lived in seven states in the past 30 years. Alaska’s state funding model is the least diversified I’ve ever seen. It’s self-defeating. We need leadership in the private sector and state government to counter the governor with a commitment to a strong economy, fueled by revenue. A state that doesn’t tax its people only serves a fantasy. Reality will be painful if we let the governor skin Alaska’s hide and hang it up to dry.
- Nathan Freeman
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