Senate Republicans approve alcohol tax

Posted: Tuesday, May 14, 2002

JUNEAU (AP) -- A bill to increase the state's alcohol tax by about 7 cents per drink was approved in the Senate on Monday.

The measure, which will raise about $20 million in additional revenues, passed by a 13-7 vote. It now goes to the House for consideration.

Raising the state's alcohol tax was a contentious issue in the Legislature this year as many Republicans in the Senate took a hard line against any new taxes.

The state faces an estimated $963 million budget deficit next year and some lawmakers had viewed the alcohol tax increase and other revenue raising measures as a way to close that gap.

Senate Republicans had spoken out against a proposed income tax and a plan to use earnings from the permanent fund to close the budget deficit.

Instead, Senate Republicans wanted a constitutional amendment placed on the November ballot that limits state spending.

Sen. Jerry Ward, R-Anchorage, tried to amend the House bill on Monday to make it take effect only after voters approved a spending cap. The Senate resolution to place the constitutional amendment never passed the House this session.

''We're about to take millions of dollars and put it into a bloated government,'' Ward said. The amendment failed 15-5.

Sen. Rick Halford, R-Chugiak, had been a proponent of the alcohol tax, voted against the alcohol tax on Monday, but announced that he had mistakenly cast that vote. He voted in favor of the measure when it came up for reconsideration.

The alcohol tax measure passed the Senate 13-8. Republican Sens. John Cowdery, of Anchorage; Lyda Green, of Wasilla; Pete Kelly, of Fairbanks; Robin Taylor, of Wrangell; Gene Therriault, of North Pole and Ward voted against it.

Sen. Lyman Hoffman, of Bethel, cast the lone Democrat vote against the measure.

The state's current tax on beer, wine and other spirits raises about $12 million a year. Lawmakers supporting the measure argued that Alaska spends millions more each year on the effects of alcohol abuse.

The tax was sponsored by Rep. Lisa Murkowski, R-Anchorage, who originally had proposed a 10 cents per drink increase.

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