Murkowski joins Sullivan in supporting GOP tax plan

U.S. Sen. Lisa Murkowski said Wednesday that she'll vote for the Republican tax overhaul that's nearing a vote in the Senate, joining Alaska's other senator, Dan Sullivan, in support of the plan.

Murkowski, whose opposition helped sink previous GOP efforts to repeal and replace the Affordable Care Act, endorsed the tax plan in a 250-word statement posted on Facebook on Wednesday afternoon. In it, she said Republicans' proposal would lower tax rates for people and businesses, double the tax credit for raising a child and eliminate the Affordable Care Act penalty for not having health insurance.

And, she said, it includes language to open the Arctic National Wildlife Refuge for oil and gas production — a dream of Murkowski's and a generation of Alaska lawmakers, including her father Frank, the former U.S. senator and Alaska governor.

A spokeswoman for Murkowski, Karina Petersen, said the senator was not available for an interview.

Sullivan touted his support for the legislation Tuesday on CNN, where he told host Wolf Blitzer that Republicans want to let "middle-class families bring home more pay," and downplayed a forecast by the nonpartisan Congressional Budget Office that the overhaul would add $1.4 trillion to the federal deficit over the next decade. Sullivan was also unavailable for an interview, said spokesman Mike Anderson.

The Senate's tax plan — which differs substantially from a version that's already passed the House — could come to a vote later this week. The New York Times reported Wednesday that Senate GOP leaders still lack the votes to pass the tax overhaul, but several holdouts this week have signaled new openness to supporting the bill.

The Senate proposal, backed by President Donald Trump, would reduce most income tax rates for individuals, boost the child tax credit and standard deduction and repeal certain deductions. It also would cut corporate taxes, replacing the current structure and its top rate of 35 percent with a single, 20 percent rate.


The overhaul's supporters argue that such changes would stimulate the U.S. economy and benefit Americans of all income levels by reducing taxes and creating jobs. Sullivan's office pointed to an analysis by the Tax Foundation that projects the Senate proposal will add about 2,000 jobs in Alaska and provide middle-income families with a $3,300 boost in after-tax income.

The Alaska branch of the National Federation of Independent Businesses, with some 1,800 members in the state, has been pushing Murkowski, Sullivan and U.S. Rep. Don Young to support the tax overhaul, said Denny DeWitt, NFIB's state director and a lobbyist in Juneau.

The legislation would allow members to reinvest more money into their small businesses, and keep more of their profits, DeWitt said in a phone interview. And by eliminating the requirement that Americans either acquire health insurance or pay a tax penalty, it would give relief to small-business owners, who often are the people facing that dilemma, DeWitt added.

"The people I represent are the folks that live down the street from you and are running a hobby shop, or a snow plowing operation," DeWitt said.

"Small businesses are not just littler Exxons," he added. "They're the folks we know that are hardworking people that are trying to keep their head above water and maybe have two or three or four employees. And they don't get very good consideration, in my judgment."

Critics say the proposal is tilted toward corporations and the wealthy, and argue that projections of growth are based on flawed "trickle-down" economic theory.

In a recent University of Chicago survey of more than three dozen economists, just one said the GOP tax plan would produce a substantial increase in the U.S. gross domestic product.

And an analysis of the Senate's tax proposal by the nonpartisan, Washington, D.C.-based Tax Policy Center found that taxpayers in the 95th to 99th percentile of income would see the biggest jump, proportionally, in after-tax income: 3.5 percent, while the middle fifth of taxpayers would see a 1.4 percent increase.

Joni Bruner, the organizer of a progressive group of a dozen people who demonstrated against the tax bill Tuesday outside of Murkowski's Anchorage office, accused the senator of trading Alaskans' interests for the prize of drilling in ANWR.

"She's a sellout. I'm really disappointed. I'm angry. I don't think she's listening to us," Bruner, 59, said in a phone interview. "I think that she's usually pretty thoughtful before she makes a choice, and she tends to listen to the constituents. But this time I just don't think she's even paying attention — ANWR just looks so good to her."

Defenders of the Affordable Care Act, also known as Obamacare, have also attacked the GOP tax plan because of the provision to eliminate the requirement that Americans have insurance or pay a penalty. About 20,000 Alaska taxpayers paid penalties totaling $12.8 million in 2015, according to the Internal Revenue Service, or about $640 per taxpayer.

Repealing the requirement would lead to 4 million fewer people with health insurance in 2019, according to projections released this month by the Congressional Budget Office. Average premiums on the individual market — which about 23,000 Alaskans use — would jump by about 10 percent, the CBO said.

Without the penalty to encourage people to buy insurance, health care experts expect more healthy people to go without it — meaning that their premiums would no longer subsidize the care of sicker people.

"The market in Alaska is fairly fragile," said Jessie Menkens, who works for the Alaska Primary Care Association overseeing a program that helps people buy and maintain health insurance on the individual market. "This is just such a tenuous time right now — we're already enduring so much confusion and uncertainty that the timing of this repeal effort is extremely challenging."

The sole insurer selling plans on Alaska's individual market, Premera, supports efforts to stabilize that market, including incentives for people to buy insurance, said spokeswoman Melanie Coon.

But one thing that could make the state's market more resilient, she added, is that roughly 90 percent of Alaskans' plans are subsidized by the federal government.

Those subsidies make insurance cheaper, which could mean that fewer Alaskans would give up their plans if the penalty is repealed, compared to other states; in Washington, Coon said, only 40 percent of plans are subsidized.


Alaska, Coon said, "may not take as big a hit as other states."

Correction: This story originally misquoted Denny DeWitt of the National Federation of Independent Businesses. He referred to his members as "not just littler Exxon," not "just just littler Exxons," as the story initially said.

Nathaniel Herz

Anchorage-based independent journalist Nathaniel Herz has been a reporter in Alaska for nearly a decade, with stints at the Anchorage Daily News and Alaska Public Media. Read his newsletter, Northern Journal, at natherz.substack.com