This June 26, 2014, file photo, shows a cruise ship docked in Juneau, while a paraglider soars above. The tax bill approved Saturday by the U.S. Senate will open part of the Arctic National Wildlife Refuge to oil and gas drilling. The measure also struck down a proposed cruise ship tax that Republican Sen. Lisa Murkowski said would have disproportionately affected her state. (AP Photo/Becky Bohrer, File)

This June 26, 2014, file photo, shows a cruise ship docked in Juneau, while a paraglider soars above. The tax bill approved Saturday by the U.S. Senate will open part of the Arctic National Wildlife Refuge to oil and gas drilling. The measure also struck down a proposed cruise ship tax that Republican Sen. Lisa Murkowski said would have disproportionately affected her state. (AP Photo/Becky Bohrer, File)

Senators tout tax bill provisions as beneficial

  • By Becky Bohrer
  • Monday, December 4, 2017 10:47pm
  • News

JUNEAU — The cruise industry has dodged a tax increase after Alaska’s U.S. senators helped strike the provision from the tax bill that passed the Senate.

The bill approved early Saturday includes other provisions that Alaska Republican Sens. Lisa Murkowski and Dan Sullivan hailed as significant for Alaskans, including allowing oil and gas drilling on the coastal plain of the Arctic National Wildlife Refuge.

Murkowski called the package “a critical milestone in our efforts to secure Alaska’s future.”

The measure also would provide tax benefits for Alaska Native corporations to encourage contributions to trusts that promote the health, education and welfare of beneficiaries and to help the funds grow.

The cruise ship tax provision could have impacted tourism, a major driver of an Alaska economy that has otherwise slowed in a recession because of persistently low oil prices.

This summer, more than 1 million tourists came to the state on cruise ships, and the industry anticipates breaking that record during the 2018 summer cruise season, said John Binkley, president of Cruise Lines International Association Alaska, a trade group.

“It’s really one of the bright spots in the economy for Alaska, and I think Sen. Sullivan and Sen. Murkowski felt this would be another blow to Alaska’s economy if we tried to then restrict that growth or to slow down that growth in that sector,” he said.

The provision would have applied to foreign ships, assessing a corporate tax based on their time in U.S. waters, Binkley said. By one estimate, it would have raised $700 million over 10 years, though Binkley said there were no hearings to vet that estimate.

The tax increase would have applied to other U.S. ports as well. But ships operating in Alaska are in U.S. waters far longer than vessels leaving Miami for places such as the Caribbean or departing Los Angeles for Mexico, he said.

Critics feared the tax could have discouraged ships from routes where they would face higher taxes.

Sullivan and Murkowski said the tax would have disproportionately affected Alaska, particularly impacting communities that rely on cruise ship tourism. Sullivan lobbied Senate leadership and other lawmakers in getting the tax increase stripped from the bill, said Matt Shuckerow, a Sullivan spokesman.

The bill isn’t a done deal; the House and Senate passed their own tax bills and differences between the two need to be hashed out. The cruise ship tax, however, was not in the House bill, Shuckerow said.

FILE- In this June 4, 2017 file photo, a cruise ship sits docked near downtown Juneau, Alaska. The tax bill approved Saturday, Dec. 2, 2017, by the U.S. Senate will open part of the Arctic National Wildlife Refuge to oil and gas drilling. The measure also struck down a proposed cruise ship tax that Republican Sen. Lisa Murkowski said would have disproportionately affected her state. (AP Photo/Becky Bohrer, File)

FILE- In this June 4, 2017 file photo, a cruise ship sits docked near downtown Juneau, Alaska. The tax bill approved Saturday, Dec. 2, 2017, by the U.S. Senate will open part of the Arctic National Wildlife Refuge to oil and gas drilling. The measure also struck down a proposed cruise ship tax that Republican Sen. Lisa Murkowski said would have disproportionately affected her state. (AP Photo/Becky Bohrer, File)

More in News

In this Sept. 21, 2017, file photo, former vice presidential candidate Sarah Palin speaks at a rally in Montgomery, Ala. Palin is on the verge of making new headlines in a legal battle with The New York Times. A defamation lawsuit against the Times, brought by the brash former Alaska governor in 2017, is set to go to trial starting Monday, Jan. 24, 2022 in federal court in Manhattan. (AP Photo/Brynn Anderson, File)
Palin COVID-19 tests delay libel trial against NY Times

Palin claims the Times damaged her reputation with an opinion piece penned by its editorial board

COVID-19. (Image courtesy CDC)
COVID-19 at all-time high statewide

The state reported 5,759 new cases sequenced from Jan. 21-23

Volunteers serve food during Project Homeless Connect on Jan. 25, 2018, at the Soldotna Regional Sports Complex in Soldotna, Alaska. (Erin Thompson/Peninsula Clarion file)
Project Homeless Connect to provide services, support on Wednesday

The event will be held at the Soldotna Sports Complex on Wednesday from 9 a.m. to 3 p.m.

The logo for the Kenai Peninsula Borough School District is displayed inside the George A. Navarre Borough Admin Building on Thursday, July 22, 2021 in Soldotna, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
Schools aim for business as usual as cases reach new highs

On Monday, there were 14 staff members and 69 students self-isolating with the virus

Triumvirate Theatre is seen on Monday, Feb. 22, 2021 in Nikiski, Alaska. The building burned in a fire on Feb. 20. (Ashlyn O’Hara/Peninsula Clarion)
Triumvirate construction on hold as theater seeks additional funding

The new theater is projected to cost around $4.7 million.

The logo for the Kenai Peninsula Borough School District is displayed inside the George A. Navarre Borough Admin Building on Thursday, July 22, 2021 in Soldotna, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
KPBSD schools to start 2 hours late Tuesday

Due to weather, all but 4 schools will be delayed

Data from the state of Alaska show a steep increase in COVID-19 cases in January 2022. (Department of Health and Social Services)
Omicron drives COVID spike in Alaska as officials point to decreasing cases in eastern US

On Friday, the seven-day average number of daily cases skyrocketed to 2,234.6 per 100,000 people

Dana Zigmund/Juneau Empire
Dan Blanchard, CEO of UnCruise Adventures, stands in front of a ship on May 14, 2021.
Smooth sailing for the 2022 season?

Cautious optimism reigns, but operators say it’s too early to tell.

Former Alaska Assistant Attorney General Elizabeth Bakalar speaks a news conference on Jan. 10, 2019, in Anchorage, Alaska, after she sued the state. A federal judge on Thursday, Jan. 20, 2022, ruled that Bakalar was wrongfully terminated by the then-new administration of Alaska Gov. Mike Dunleavy for violating her freedom of speech rights. (AP File Photo/Mark Thiessen, File)
Judge sides with attorney who alleged wrongful firing

Alaska judge says the firing violated free speech and associational rights under the U.S. and state constitutions.

Most Read