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Governor Vetoes Legislation That Would Fund Reading Incentive Grants and Career and Technical Programs
Anchorage, AK– Today, Governor Mike Dunleavy vetoed Senate Bill 113, which sought to modernize Alaska’s corporate income tax law to include online sales from outside corporations. Senate Bill 113 was a bipartisan compromise that would fund educational opportunities in career and technical education and reading incentive grants. Senator Bill Wielechowski (D-Anchorage), who sponsored the legislation through the Senate Rules Committee, expressed deep disappointment with the veto, which would have brought in $25 to $65 million annually from online corporations without impacting a single Alaskan.
“SB 113 was a common-sense, bipartisan solution to help close our revenue gap without costing Alaskans or Alaska businesses a penny,” said Sen. Wielechowski. “The Governor had the opportunity to stand with Alaska families, students, and communities – but instead, he chose to side with tech corporations that profit from Alaskans and utilize our infrastructure, while paying nothing back to our state.”
When Alaska’s corporate tax laws were first written in 1970, they did not anticipate the modern digital economy. As a result, major social media and streaming companies can make significant profits from Alaskans without paying corporate taxes here, even though they pay them in 36 other states.
The bill closed this loophole by modernizing Alaska’s corporate tax structure to align with reforms already adopted and widely accepted by other states. These changes are standard nationwide, widely recognized as fair, and have been shown not to increase consumer costs. In fact, by ensuring companies are taxed only on the business they actually conduct in Alaska, the measure would have made Alaska more attractive for data centers and high-tech investment.
“Every Alaskan knows Alaska is facing a revenue crisis, and that our education system needs critical resources. This bill would have been a step towards closing those gaps without taxing Alaskans while asking these corporations to contribute to the state that they use for their business ventures,” Wielechowski said. “The Governor’s veto sends the message that outside corporations come before Alaska’s schools, Alaska’s workforce, and Alaska’s future.”
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