The Four Guiding Principles
- 1 An oil tax system that is FAIR TO ALASKANS
- 2 An oil tax system that encourages NEW PRODUCTION
- 3 An oil tax system that is SIMPLE and focused on RESTORING BALANCE
- 4 A COMPETITIVE oil tax system that is DURABLE
Creating Opportunity For Alaskans
Alaska oil production is less than 560,000 barrels of oil per day and continuing to decline at roughly six percent each year. The goal is simple: Fill the Pipeline and create economic opportunities for Alaskans and future generations.
To do this, Governor Parnell introduced legislation that:
- Is fair to Alaskans by eliminating the progressivity tax and replacing it with a simple, flat production tax. It will better protect Alaskans at low oil prices with more state revenues, in exchange for lower revenues at high oil prices.
- Targets new production by focusing tax incentives on actual production, not simply company spending in oil fields. It eliminates the current 20 percent Qualified Capital Expenditure Credit, and establishes a Gross Revenue Exclusion to provide a tax
break for new production.
- Is simple and restores balance to the system by replacing the complex progressivity structure with a simple flat tax. It will restore balance by not putting Alaskans' treasury at risk for oil tax payments at lower oil prices.
- Makes Alaska competitive and is durable. It focuses tax benefits on new production over the long-term and will attract new entrants into Alaska’s oil fields by extending the Small Producer Tax Credit through 2022.
With this legislation, we have a real opportunity to create a future for all Alaskans through new oil production.