Instead of taxes, Alaska should use permanent fund earnings

Posted: Thursday, May 01, 2003

Several letter writers have suggested that the fairest tax of all is the graduated income tax. Actually, it is the most unfair tax of all. It is unfair to tax people for being successful. Further, we need to attract the type of people who know how to create wealth and give jobs and service to others.

The second most unfair tax is the lottery. It is a tax on the poor and illiterate who do not understand the mathematical law of probability. When one is considering any form of gambling to raise money for the government, he should also consider the severe social problems caused by gambling. Addiction to gambling is just as bad as addiction to drugs or alcohol.

One way the state can save money is stopping the longevity bonus. This program was set up to reward senior citizens who have lived in Alaska prior to statehood. When the court decided that programs could not be based on how long someone had lived in Alaska, the state made the program for everyone who was over a certain age and had lived in Alaska for at least one year. As the result, many seniors from other states moved to Alaska. Soon the program had grown so big that it was impossible to keep it up.

Today, those seniors who just happened to get in on the program, get $250 per month for the rest of their lives. Other senior citizens, who became 65 after the program was discontinued, get nothing even though they may have lived in Alaska much longer than many people getting the money. The program should be called what it is: an unfair lottery to certain lucky senior citizens who just happened to become 65 at a "lucky" time.

The permanent fund was set up as a rainy-day account. It is raining now. We should stop paying dividends and instead use the earnings of the permanent fund to pay for government. If we used only the income from the fund, we could fund state government forever with no taxes. This is the fair thing to do.

Stop paying dividends and use the earnings of the permanent fund to pay for state services instead of taxes.

Esther Rhines


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