Posted on 08/30/2008 9:10:30 PM PDT by RushingWater
Republicans in Congress this June united to defeat a proposed windfall tax on oil companies, deriding it as a bad idea that would discourage investment in U.S. oil exploration.
Things worked out far differently in the GOP stronghold of Alaska, a state whose economic fate is closely tied to the oil industry.
Over the opposition of oil companies, Republican Gov. Sarah Palin and Alaska's Legislature last year approved a major increase in taxes on the oil industry — a step that has generated stunning new wealth for the state as oil prices soared.
(Excerpt) Read more at seattletimes.nwsource.com ...
People need to get the full story...the VECO scandal. Put in the correct context.
Well, there goes the ‘RATS’ claim that she is “in bed” with “BIG oil.” Obammie is this BIG loser on this one.
If I’m reading this right, the Alaska state legislature voted for this, and Palin decided to give the citizens the money instead of letting the politicians get ahold of it to spend.
If we ever give university degrees in liberal BS analysis this would be a good case study. I know nothing about the history of this and can tell they are dancing around this trying to make it sound like Palin supported a windfall profits tax when probably was tax increase that resulted in a ‘windfall’ for the state.
Question is whether this was in increase in corporate net income, and if so from what level to what level and compare that with some other states. If it was really a windfall profits tax (e.g. something time limited or triggered at some level etc.) then it is poorly written.
Taxes aren’t always direct and linear. Sometimes raising them can be useful. Sometimes lowering them can be useful. There’s an effect of the market whenever you do so and all situations are inherently unique.
That said...the taxes still trickle down.
It’s not as simple as calling it a tax, or a windfall tax as O’Bama has called it. It’s a comprehensive bill, that has resulted in a win-win.
Here’s the actual deal...
Legislation that generates billions of dollars in additional oil and gas revenue for future generations of Alaskans passed the Alaska Senate this evening. HB 3001 replaces the state’s outdated ELF system with a thoroughly modern oil tax plan that raises significantly more revenue and can help to refill the trans-Alaska Oil Pipeline by encouraging the industry to explore for new oil deposits.
Sen. Ralph Seekins (R - Fairbanks) chairs the Senate Special Committee on Natural Gas Development, the committee responsible for the landmark legislation.
“This legislation hits all the bases. It modernizes the state’s petroleum tax structure and spurs the industry to go out and drill for more oil by granting tax credits for verifiable expenditures made in Alaska. This bill also captures our fair share of record high oil prices so Alaska has the revenue it needs for many years to come,” Said Sen. Seekins.
“There is far more to this piece of legislation than just raising more oil revenue because it eventually creates new, good paying jobs in many different sectors of the economy,” said Senate President Ben Stevens.
Here are some highlights of bill:
* 20% production tax credits for oil and gas investment in Alaska
* 22.5% tax rate on “net” positive cash flow or “Production Tax Value”
* Progressivity. A higher tax rate (.25) kicks in when oil sells for more than $55 per barrel.
* At today’s ANS closing price of $75.05 and a full year of production the PPT will generate 3.7 billion in one year revenues, almost three times the amount generated under the current ELF based production tax.
* Protects declining Cook Inlet oil production by leaving the existing tax structure in place.
* Requires a report in 2011 about how well all the incentive provisions are working to enhance exploration, development and production in the state.
Alaska has been giving people an oil royalty check for decades.
Correct you are sir! Every Alaskan resident will get an extra $1200.00 added to their annual Alaska Permanent Dividend Fund check to make up for the rise in fuel costs in Alaska. Good move by Palin.
Right...Bottom line...everyone benefits!!
I hate telling the rest of the world but every eligible Alaskan over six months old will get an estimate $3,300 PFD this year many as soon as Sept 12th, part of it was $1200 as an amount to overcome higher winter heating bills, signed and passed by Sarah Palin.
During the Murkowski administration, the Veco company -a representative for the oil companies- bribed a bunch of state legislators to put in place a favorable tax system (VECO also is the company that got Ted Stevens in trouble). All these indictments in AK are due to this scandal. A couple legislators were sent to federal prison. After that scandal the state had to restructure the its tax system.
Taxing oil in AK is A LOT different than Washington imposing a windfall tax for no reason. Alaskans own the natural resource per the state constitution.
FINALLY. I’ve been expecting this attack, as leftists attempt to split the conservative block on Palin.
Bottom Line: Palin is NOT in the pocket of BIG OIL. In fact, she is hard charger who is their pocket.
It will hard to pin the “oil lacky” tag on her.
Very informative. I don’t see what was done as the imposition of a windfall profits tas. If any coastal state in the lower 48 would open up offshore drilling, that state would get a cut of eventual production, just like Alaska.
It is really sad the level that some people on this conservative web-site will go to to cover-up bad behavior on the part of a Republican.
Increasing taxes is not a good thing and is unnecessary.
People seem to forget that FreeRepublic is dedicated to conservative principles, not boosting the GOP.
Sometimes the two do not go hand and hand.
THANK YOU for the clarification and enlightenment on that!! Facts are still on our side. :-)
Ping!
Do you think the tax rates on Alaskan oil and NG co’s are high? Or are you just being negative?
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