Take Action TODAY on SB 92 and SB 112!

Written By Fairbanks Climate Action Coalition

Tell your Alaska Legislators that you support taxing wealthy fossil fuel corporations!

Thanks to your calls and emails to members of the Senate Finance Committee, Senate Bill 92 has advanced and may go to vote on the senate floor in the next couple days. We are so close to closing the S-Corp tax loophole and getting needed revenue for the state! 

Now we are on the final push. Unfortunately, some senators are still on the fence about supporting SB 92. Your support could make the difference for this bill passing! Call or email their offices TODAY to let them know that Alaskans all over the state support this common sense bill that will provide funds that can be used for education, healthcare, and other essential services.

See talking points below.

Call these Senators:

Call these representatives:

Passing this bill in the Senate means that the Alaska House of Representatives will have to approve the bill also. There are a couple Representatives that need to hear from Alaskans. Call Alyse Galvin and Chuck Kopp to tell them you support closing the S-corp loophole!

Background:

Two important energy bills in the Alaska Senate right now, SB 92 and SB 112, would change how the state collects taxes on multi-billion dollar oil and gas companies. We are asking people to contact legislators to let them know the Alaskan people want these bills to pass!

Alaska is facing a budget crisis that is worsening each year. In the next 2 years, there is a projected $536 million dollar deficit. The state is already cutting or underfunding essential services, like education, rural public safety, mental health services and transportation and energy infrastructure, among other things. Without significant changes and additional revenue, the people of Alaska will continue to see deep cuts impact their communities and a worsening energy crisis.  Meanwhile, Alaska's tax structure is currently rigged to allow outside oil and gas companies to extract wealth and resources from the land and people without contributing what they owe back to Alaskans.

Talking Points:

SB 92- Closing the S Corp Loophole

What does this bill do: While most large companies pay a state corporate income tax, certain pass-through entities, called S corporations (“S corps”), do not pay any income taxes in Alaska due to a loophole in the state’s tax code. This bill would close that loophole by imposing a tax on income over $5 million for oil and gas S corps. 

Why do we support SB 92?

  • Closing the S corp tax loophole is estimated to bring in over $100 million per year through 2030, funds that are desperately needed for the state budget. Right now, those funds are going to a billionaire in Texas.

  • SB-92 would end the unfair tax advantages S corporations have over regular C corporations. It is only fair that these companies pay what they owe in the same way as other corporations.

  • The Alaska Constitution instructs the Legislature to ensure that the Alaskan public gets the “maximum benefit” from the use of our natural resources. The S corp tax loophole is preventing us from getting that benefit.

  • This bill diverts tax revenue from the federal government to the State of Alaska. S corporations can write off state income taxes on their federal tax returns. Alaska’s S corp tax loophole means that S corporations pay more income taxes to the federal government while the State gets none at all.

  • This change is not unexpected or unfair to S corporations. S corporations have to pay income taxes in nearly every state except Alaska. Changing Alaska’s tax code to reflect the national consensus is common sense and has been suggested for years, including by a fiscal working group in 2021.

  • There is no evidence to support that the State will bring in more revenue or guarantee jobs by giving an income tax break to large S corporations. The Legislature can guarantee investment in Alaskan by imposing an income tax and using the revenue to fund public services.

  • A majority of Alaskans support taxing Hilcorp according to new research from Data for Progress.

SB 112 - Decreasing the Maximum Per Barrel Tax Credit

What does it do: SB-112 decreases the maximum per barrel tax credit from $8 to $5, which is a per barrel tax deduction that is based on the market value of oil (lower the market value means less profit for the industry and so there is a higher tax deduction and vice versa). It also changes how much oil producers can claim in production tax credits, making it so that they cannot claim more than they spend on capital investments.

Why do we support SB 112?

  • This could increase state revenue by up to $400 million annually (ADN Article), funding essential public services like education, safety, mental health, energy system upgrades and renewable energy projects;

  • Despite oil companies’ objections, a consulting firm in 2023 found that a change like this would have little impact on production, for current or planned projects. (Alaska Public Media);

  • There is a projected increase in oil production over the next decade; however. The way the tax code is written, the state will not net increase revenue from taxes, even as production and corporate profit increases (ADN Article).

Tips for Calling or Emailing Your Legislator

How to contact a legislator:

Use the contact information provided above, or look up the legislator you want to contact. If you’re calling, you will generally either talk to an aid or leave a message. Provide your name and where you are calling from. Share what bill you are calling to support and why; connecting to your personal story is always more powerful than just stating facts. However, any support is encouraged! Phone calls are often more highly considered by legislators, but you can also email (or do both).

Not sure where to start?
Just share your experience or reasons why you support these bills. There are plenty of people who can give them calculated figures and statistics.  Legislators want to hear from YOU about your personal experiences and values around an issue. 

Tips & Info:

  • When calling, you will likely talk to a staff member or leave a message.

  • If you are calling your district’s legislator, make sure and let them know you are one of their constituents. 

  • Keep your message or call brief and respectful.

  • Plan out & practice your remarks.

  • Ask for action and solicit support from your legislator.

  • Be specific. Name the bill you are in support of and why.

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