HOUSE TAX PLAN GOES ‘FULL BERNIE’
The Alaska Senate Majority today rolled out a handy tax calculator so Alaskans can see how much they’d pay to the State of Alaska under the income tax proposed by the Alaska House of Representatives Democrat-controlled majority, a tax scheme designed by Gov. Bill Walker’s Revenue Department.
For a single person in Alaska making $80,000 a year in gross income, the tax bill would be $1,980.50 to the State of Alaska.
That’s because the State would tax you on $74,750.00 of net income.
But say you’re a single mother or father of two and you make $80,000 a year. You’ll only get $418 off for those two kids, and your bill to the state will be $1,562.50.
The Alaska House of Representatives, now controlled by hard-left Democrats, passed House Bill 115 over the objections of the Republican minority on Saturday.
Try the Senate Majority’s tax calculation tool here.
HB 115 is endorsed by Governor Walker, who has said he has to have broad-based taxes before he’ll sign any budget.
Unlike a flat calculation used by most other states that have an income tax, HB-115 goes the California model and establishes an Alaska-specific tax code, with its own marginal tax rates and almost no deductibles.
Charitable contributions, mortgage interest, and many other usual deductions allowed under the Federal tax code are not recognized in HB-115 as legitimate deductions from Alaskans’ earnings.
The House majority’s tax treats capital gains, income from trusts, and interest from many bonds at varying rates. The tax estimator above does not have a function to compute the tax due from these other income streams. Therefore, the estimates from the calculator will tend to be low.
If the Senate passes HB 115, Alaskans will need to start itemizing their federal taxes. Most Alaskans do not itemize, but unless they do, under this tax plan they’d have to, or be taxed on the income tax they’ve paid to the State of Alaska.
Without that itemization, the single person referenced above who paid $1980.50 to the State of Alaska might owe an additional, say, $356 to the IRS. In other words, bad for taxpayers, good for paid tax accountants.
DEMOCRATS GONE WILD
HB 115 will collect $700 million for the State of Alaska. Most of that money will keep afloat a government that Senate majority members say can still be trimmed by several hundred million dollars, and can be paid for with their legislation, Senate Bill 26, which restructures the way the Permanent Fund earnings are used.
Although the Senate majority posted the tax calculator for Alaskans to get a handle on what’s at stake concerning their own pocketbook, Sen. President Pete Kelly was quick to say the Senate majority does not endorse the plan.
“They are trying to force this for ideological reasons,” Kelly said. “It is just not the math, because you’d have to be willfully ignorant of the math to claim our plan [SB 26] is not a full plan.”
The House actually increased spending it the budget it sent to the Senate, killed the spending limit offered by the Senate, and instituted an income tax to grow government, Kelly said.
“These are three indisputables. They went ‘full Bernie,” Kelly said, referring to Socialist Bernie Sanders. “They’re trying to set up an Alaska IRS system with all the fining, audits, and investigating that goes along with it. If you look at their tax plan, it mirrors the IRS. They must think Alaskans want this.”
In the Alaska State House this past week, it’s All Aboard for California!