Alaska's oil tax reduction plan moves ahead in state House

The Anchorage Daily NewsMarch 29, 2011 

JUNEAU — The effort to cut Alaska's oil-production tax is gaining speed in the state House, with a vote possible as soon as this week, even as the debate rages over whether it's a good bet to lower taxes by billions of dollars to encourage more drilling.

House Speaker Mike Chenault said the plan is for the bill to reach the floor on Wednesday for debate over amendments and a vote as soon as possible.

House approval of the bill would set up a showdown with the Senate. Leaders of the Senate have consistently said they are not interested in rolling back the state's oil taxes before the Legislature adjourns for the year on April 17.

At stake is an oil tax system that's brought billions of dollars to the state treasury since it passed in 2007. It stands among the biggest legacies of Sarah Palin's time as governor. Palin's former lieutenant governor, Gov. Sean Parnell, is leading the attempt to roll it back, saying he's become convinced it hurts investment.

It's not clear that Parnell has enough support for his plan to pass in the House. He'll need to lobby lawmakers in the coming days to ensure he does have the votes. The House Finance Committee erupted into debate on the proposal Monday, with Democrats saying Parnell failed to make the case.

Anchorage Democratic Rep. Mike Doogan said no one's offered any evidence that giving up a billion dollars or more each year in taxes would lead to anywhere near enough new drilling to balance it out.

"Do you have some information that's going to tell us that if we spend $5 billion or $10 billion that in five years we're going to get the equivalent amount of oil in the pipeline?" Doogan asked Parnell's revenue commissioner on Monday.

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