Say Anything Blog

It looks like Rob’s old showering buddy is getting a bit too greedy:

JUNEAU—Leaders of the state Senate backed down Wednesday night and agreed to the major oil tax increase Gov. Sarah Palin and the state House demand.

Senators said they expect to pass the bill today and send it back to the House to have a vote on a final agreement.

The Senate Finance Committee voted late Wednesday to increase the oil tax rate from 22.5 percent to 25 percent of net profits. The senators also agreed to the House formula of charging an additional 0.4 percent more tax for each dollar price of oil above about $52 per barrel.

The revenue department had estimated the House version could bring in around $1.5 billion more a year to the state in these times of high oil prices.

Right now we desperately need more domestic sources of oil.  But what reason do oil companies have to risk their capital and develop new sources when the government can confiscate their earnings on a whim?  And let’s face it, Alaska doesn’t need the money. They don’t have an income tax nor a sales tax.  We need more oil friendly localities to keep more of our money in the states.

At least in the past the oil taxes went back to the state’s citizens in the form of a rebate to all citizens.  That’s better than the North Dakota method in which oil taxes get absorbed by the state government.  If I had to bet I’d say that this tax increase is going to stay in the hands of the governor and legislature.  That’s just the way the greedy governments are going.