Bill would impose 3 percent sales tax

Posted: Thursday, May 01, 2003

JUNEAU (AP) A bill calling for a year-round 3 percent sales tax was introduced Wednesday in the House. Gov. Frank Murkowski did not rule out supporting the proposal, although he said he prefers a seasonal sales tax.

The measure is scheduled for its first hearing at 7 a.m. Thursday in the House Ways and Means Committee. It was sponsored by that committee.

As currently written, House Bill 293 would raise about $330 million. It calls for no exemptions for food or other necessities, but lawmakers say that could change as the bill goes through the committee process.

Some House leaders prefer a sales tax over other proposals to close the gap in the state budget between spending and revenues.

House Finance Co-Chairman John Harris, R-Valdez, said Monday he would rather see a sales tax more than a proposal to increase motor fuel taxes by 12 cents a gallon.

The gas tax increase was part of a $113 million package of tax and fee bills Gov. Frank Murkowski introduced this year aimed at narrowing the budget gap.

Murkowski also proposed cuts, including trimming education spending and eliminating the longevity bonus program for senior citizens. And he suggested lawmakers consider a seasonal sales tax or a $100 tax on employment.

Murkowski said at a news conference Wednesday that he still prefers a seasonal sales tax because it would put more of the burden on tourists.

He did not rule out signing a year-round sales tax bill.

It depends on what the mix is,'' he said.

He would not support a year-round tax if lawmakers use it to avoid making hard decisions on budget cuts, Murkowski said.

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