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Alaska needs to cut deeper before even talking about taxing Alaskans

  • Author: Steve Strait
  • Updated: July 5, 2016
  • Published May 26, 2016

(AARON JANSEN illustration)

The Alaska Legislature's challenge for the past year has been to bring down agency spending and ensure enough cash comes in to pay for a trimmed government.

Indeed, passing a budget is the only constitutional requirement the Legislature has.

Right now, lawmakers are being kept in Juneau, asked by Gov. Bill Walker to tax us heavily to meet Walker's spending habits, since he and his Democrats haven't the courage to cut. 2016 has become the year of the Walker tax tsunami.

Walker, with his Special Session Bill 4001, would levy big taxes on our income, double our gasoline tax, and take a government slice out of fish, minerals, tobacco, alcohol and excess personal-use pot. He's also going to push more taxes on our biggest economic engine – energy. Essentially, if it moves, Walker would tax it.

Even Democrat Rep. Les Gara called the tax bill a "recipe for failure."

Many Alaskans saw this tax tidal wave coming last June when the governor convened a group of his campaign supporters and a few friendly skeptics in Fairbanks to discuss the way forward on the budget.

People participating in the budget exercise at the University of Alaska Fairbanks felt they were being led to the conclusion that state spending could be cut no further, and that the answer was to be found on the revenue side of the ledger.

At the end of the budget "retreat," the governor announced that cuts would certainly be part of the solution, but since then he has reversed himself and the cuts he proposed in December were laughably modest.

He tried for an income tax but failed. Earlier this spring, through his Commissioner of Revenue Randall Hoffbeck, the governor admitted his income tax proposal was all but dead. But again he has reversed his stance and added it to the seven taxes he proposes.

In spite of being lobbied hard by various interest groups, Alaskans are not cozying up to income taxes because they have not seen state government spending brought under control.

Gov. Walker won office by promising to cut spending by 16 percent. That promise went right out the window once he took office and surrounded himself with liberal advisers, for whom big government is the answer to every question.

When conservative lawmakers tried this year to put a freeze on state employee automatic raises, they ran into yet another a brick wall constructed by Democrats.

The gasoline and fuel tax increase is a prime example of how ill-conceived this tax package is. The governor wants to double the fuel tax from 8 cents to 16 cents, which would bring in  $49 million a year in taxes. At the same time, because Democrats won't agree to a freeze in raises for state workers, the state labor costs will increase by at least $70 million. The fuel tax doesn't even come close to slowing down out-of-control state spending.

With Walker running through state savings at the rate of $9 million a day, he's lost his budget-cutting mojo. He has only addressed how to get more money in.

The governor kept piling more and more onto the special session – not just taxes but tax credits, Permanent Fund restructuring and a host of other bills. As late as Monday, he added an 11th-hour item that is also his 11th special session topic: to allow his gas line project to borrow money from a fund of the Alaska Industrial Development and Export Authority. Under this scenario, instead of paying as he goes on the gas line, he'd plunge the state into debt.

That item alone deserves the Legislature's full, undistracted attention.

Because it's an elected body of Alaskans who represent every neighborhood in the state, the Legislature is argumentative by design. The point of the argument is to look at a measure from every possible angle, to make sure every unintended consequence is understood.

Our Legislature is being forced to consider taxes, and we know taxes have many unintended consequences. It's time for Alaskans to let lawmakers and the governor know that the right call is the call for smaller government, not the grab for our hard-earned cash.

Steve Strait is CEO of Strait Media, which serves rural Alaska markets. He is a member of the Alaska DOT Aviation Advisory Board, and the Lake Hood and Anchorage International Long Range Planning committees. He also is immediate past District 21 chair for the Alaska Republican Party, and serves on the party's communication committee. 

The views expressed here are the writer's own and are not necessarily endorsed by Alaska Dispatch News, which welcomes a broad range of viewpoints. To submit a piece for consideration, email commentary@) Send submissions shorter than 200 words to or click here to submit via any web browser.

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