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SB 5002: "An Act relating to the exploration incentive credit; increasing the motor fuel tax; increasing the taxes on cigarettes and tobacco products; taxing electronic smoking products; adding a definition of 'electronic smoking product' and requiring labeling of an electronic smoking product; increasing the excise tax on alcoholic beverages; relating to exemptions from the mining license tax; removing the minimum and maximum restrictions on the annual base fee for the reissuance or renewal of an entry permit or an interim-use permit; increasing the mining license tax rate; relating to mining license application, renewal, and fees; increasing the fisheries business tax and fishery resource landing tax; relating to refunds to local governments; and providing for an effective date."

00                            SENATE BILL NO. 5002                                                                         
01 "An Act relating to the exploration incentive credit; increasing the motor fuel tax;                                    
02 increasing the taxes on cigarettes and tobacco products; taxing electronic smoking                                      
03 products; adding a definition of 'electronic smoking product' and requiring labeling of                                 
04 an electronic smoking product; increasing the excise tax on alcoholic beverages; relating                               
05 to exemptions from the mining license tax; removing the minimum and maximum                                             
06 restrictions on the annual base fee for the reissuance or renewal of an entry permit or an                              
07 interim-use permit; increasing the mining license tax rate; relating to mining license                                  
08 application, renewal, and fees; increasing the fisheries business tax and fishery resource                              
09 landing tax; relating to refunds to local governments; and providing for an effective                                   
10 date."                                                                                                                  
11 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
12    * Section 1. AS 16.43.160(c) is amended to read:                                                                   
01            (c)  The annual base fee for issuance or renewal of an entry permit or an                                    
02       interim-use permit [MAY NOT BE LESS THAN $30 OR MORE THAN $3,000. THE                                             
03       ANNUAL BASE FEE] must reasonably reflect the different rates of economic return                                   
04       for different fisheries. In addition to the annual base fee established by the commission                         
05       under this subsection, a nonresident shall pay an annual nonresident surcharge for the                            
06       issuance or renewal of one or more entry permits or interim-use permits. The                                      
07       commission shall establish the annual nonresident surcharge by regulation [AT AN                                  
08       AMOUNT THAT IS AS CLOSE AS IS PRACTICABLE TO THE MAXIMUM                                                          
09       ALLOWED BY LAW].                                                                                                  
10    * Sec. 2. AS 27.30.030(a) is amended to read:                                                                      
11            (a)  In a tax year [OR ROYALTY PAYMENT PERIOD], subject to (c) of this                                       
12       section and the respective limitations of this subsection, the person may apply the                               
13       credit, the taking of which was approved under AS 27.30.020(2), against [(1)] taxes                               
14       payable by the person                                                                                             
15                 (1) [(A)]  under AS 43.65; application of the credit under this                                     
16       paragraph [SUBPARAGRAPH] may not exceed the lesser of                                                         
17                      (A) [(i)]  50 percent of the person's tax liability under AS 43.65                             
18            for the tax year that is related to production from the mining operation at which                            
19            the exploration activities occurred, as shown under (b) of this section; or                                  
20                      (B) [(ii)]  50 percent of the person's total tax liability under                               
21            AS 43.65 for the tax year;                                                                                   
22                 (2) [(B)]  under AS 43.20; application of the credit under this                                     
23       paragraph [SUBPARAGRAPH] may not exceed the lesser of                                                         
24                      (A) [(i)]  an amount equal to the amount determined under                                      
25            (1)(A) [(A)(i)] of this subsection [PARAGRAPH]; or                                                   
26                      (B) [(ii)]  50 percent of the person's total tax liability under                               
27            AS 43.20 for the tax year [; AND                                                                             
28                 (2)  MINERAL PRODUCTION ROYALTY PAYMENTS PAYABLE                                                        
29       BY THE PERSON UNDER AS 38.05.135 - 38.05.160 AND 38.05.212 FOR                                                    
30       PRODUCTION FROM THE MINING OPERATION AT WHICH THE                                                                 
31       EXPLORATION ACTIVITIES OCCURRED; APPLICATION OF THE CREDIT                                                        
01       UNDER THIS PARAGRAPH MAY NOT EXCEED 50 PERCENT OF THE                                                             
02       PERSON'S MINERAL PRODUCTION ROYALTY PAYMENT LIABILITY FROM                                                        
03       THE MINING OPERATION AT WHICH THE EXPLORATION ACTIVITIES                                                          
04       OCCURRED].                                                                                                        
05    * Sec. 3. AS 27.30.030(b) is amended to read:                                                                      
06            (b)  If the person applies the credit against the person's tax liability under                               
07       (a)(1)(A) or (a)(2)(A) [(a)(1)(A)(i) OR (a)(1)(B)(i)] of this section, the commissioner                       
08       of revenue shall disallow application of the credit under that provision unless the                               
09       person files with the person's tax return an accounting of the person's mining operation                          
10       activities for each mining operation that is included in the tax return and as to which                           
11       the credit is being applied. The accounting of mining operation activities required by                            
12       this subsection shall be made                                                                                     
13                 (1)  on a form prescribed by the Department of Revenue; on the form,                                    
14       the person shall                                                                                                  
15                      (A)  identify the mining operations for which the credit is                                        
16            claimed; and                                                                                                 
17                      (B)  set out the gross income attributable to the mining                                           
18            operations and other information about the mining operations that the                                        
19            Department of Revenue may require;                                                                           
20                 (2)  without regard to an exemption to which the person may be entitled                                 
21       under AS 43.65.010(a).                                                                                            
22    * Sec. 4. AS 27.30.040 is amended to read:                                                                         
23            Sec. 27.30.040. Credit may be carried forward. Except as its application is                                
24       limited by AS 27.30.030 and 27.30.050, a portion of a credit that is not applied under                            
25       AS 27.30.030 during a tax year [OR ROYALTY PAYMENT PERIOD] may be                                                 
26       carried forward to and applied during a subsequent tax year [OR ROYALTY                                           
27       PAYMENT PERIOD].                                                                                                  
28    * Sec. 5. AS 27.30.050 is amended to read:                                                                         
29            Sec. 27.30.050. Limit on application of credit. An exploration incentive                                   
30       credit for a mining operation may not exceed $20,000,000 and must be applied within                               
31       15 tax years [OR ROYALTY PAYMENT PERIODS] after the taking of the credit is                                       
01       approved under AS 27.30.020(2), but the tax years [OR ROYALTY PAYMENT                                             
02       PERIODS] in which the credit is applied need not be                                                               
03                 (1)  the tax year [OR ROYALTY PAYMENT PERIOD] in which the                                              
04       person first incurs liability for payment of tax [OR ROYALTY] based on the person's                               
05       activity that is the basis of the claim of the exploration incentive credit; or                                   
06                 (2)  consecutive periods.                                                                               
07    * Sec. 6. AS 38.05.150(d) is amended to read:                                                                      
08            (d)  For the privilege of mining or extracting the coal in the land covered by                               
09       the lease, the lessee                                                                                             
10                 (1)  shall pay to the state the royalties specified in the lease; the                                   
11       royalties shall be fixed before offering the lease, and shall be effective for a period of                        
12       not more than 20 years; the royalties shall be not less than five cents a ton of 2,000                            
13       pounds; [THE ROYALTY PAYMENT IS SUBJECT TO THE EXPLORATION                                                        
14       INCENTIVE CREDIT AUTHORIZED BY AS 27.30;]                                                                         
15                 (2)  shall also pay an annual rental, payable at the date of the lease and                              
16       annually thereafter, on the land or coal deposits covered by the lease, at a rate fixed by                        
17       the commissioner before offering the lease; the annual rental shall be effective for a                            
18       period of not more than 20 years; the annual rental shall be not less than 25 cents an                            
19       acre for the first year of the lease, not less than 50 cents an acre for the second year,                         
20       third year, fourth year and fifth year, and not less than $1 an acre for each year                                
21       thereafter during the continuance of the lease; the rental for each year shall be credited                        
22       against the royalties as they accrue for that year; each lease shall provide that the                             
23       annual rental payment is subject to adjustment at intervals of not [NO] more than 20                          
24       years and adjustments shall be based on the current rates for properties similarly                                
25       situated.                                                                                                         
26    * Sec. 7. AS 43.40.010(a) is amended to read:                                                                      
27            (a)  In addition to the surcharge levied under AS 43.40.005, there is levied a                               
28       tax of 16 [EIGHT] cents a gallon on all motor fuel sold or otherwise transferred within                       
29       the state, except that                                                                                            
30                 (1)  the tax on aviation gasoline is seven [FOUR AND SEVEN-                                         
31       TENTHS] cents a gallon;                                                                                           
01                 (2)  the tax on motor fuel used in and on watercraft of all descriptions is                             
02       10 [FIVE] cents a gallon;                                                                                     
03                 (3)  the tax on all aviation fuel other than gasoline is six and one-half                           
04       [THREE AND TWO-TENTHS] cents a gallon; and                                                                        
05                 (4)  the tax rate on motor fuel that is blended with alcohol is the same                                
06       tax rate a gallon as other motor fuel; however, in an area and during the months in                               
07       which fuel containing alcohol is required to be sold, transferred, or used in an effort to                        
08       attain air quality standards for carbon monoxide as required by federal or state law or                           
09       regulation, the tax rate on motor fuel that is blended with alcohol is six cents a gallon                         
10       less than the tax on other motor fuel not described in (1) - (3) of this subsection.                              
11    * Sec. 8. AS 43.40.010(b) is amended to read:                                                                      
12            (b)  In addition to the surcharge levied under AS 43.40.005, there is levied a                               
13       tax of 16 [EIGHT] cents a gallon on all motor fuel consumed by a user, except that                            
14                 (1)  the tax on aviation gasoline consumed is seven [FOUR AND                                       
15       SEVEN-TENTHS] cents a gallon;                                                                                     
16                 (2)  the tax on motor fuel used in and on watercraft of all descriptions is                             
17       10 [FIVE] cents a gallon;                                                                                     
18                 (3)  the tax on all aviation fuel other than gasoline is six and one-half                           
19       [THREE AND TWO-TENTHS] cents a gallon; and                                                                        
20                 (4)  the tax rate on motor fuel that is blended with alcohol is the same                                
21       tax rate a gallon as other motor fuel; however, in an area and during the months in                               
22       which fuel containing alcohol is required to be sold, transferred, or used in an effort to                        
23       attain air quality standards for carbon monoxide as required by federal or state law or                           
24       regulation, the tax rate on motor fuel that is blended with alcohol is six cents a gallon                         
25       less than the tax on other motor fuel not described in (1) - (3) of this subsection.                              
26    * Sec. 9. AS 43.40.030(a) is amended to read:                                                                      
27            (a)  Except as specified in AS 43.40.010(j), a person who uses motor fuel to                                 
28       operate an internal combustion engine is entitled to a motor fuel tax refund of 12 [SIX]                      
29       cents a gallon if                                                                                                 
30                 (1)  the tax on the motor fuel has been paid;                                                           
31                 (2)  the motor fuel is not aviation fuel, or motor fuel used in or on                                   
01       watercraft; and                                                                                                   
02                 (3)  the internal combustion engine is not used in or in conjunction with                               
03       a motor vehicle licensed to be operated on public ways.                                                           
04    * Sec. 10. AS 43.50.150(c) is amended to read:                                                                   
05            (c)  The department may enter into an agreement with a municipality that                                     
06       imposes a tax on cigarettes, electronic smoking products, or other tobacco products                           
07       for the purpose of jointly auditing a person liable for a tax under AS 43.50.010 -                                
08       43.50.390 and the municipal tax on cigarettes, electronic smoking products, or other                          
09       tobacco products.                                                                                                 
10    * Sec. 11. AS 43.50.170 is amended by adding a new paragraph to read:                                              
11                 (13)  "electronic smoking product" has the meaning given in                                             
12       AS 43.50.390.                                                                                                     
13    * Sec. 12. AS 43.50.190(a) is amended to read:                                                                     
14            (a)  There is levied an excise tax on each cigarette imported or acquired in this                            
15       state of 112 [,                                                                                               
16                 (1)  AFTER DECEMBER 31, 2004, BUT BEFORE JULY 1, 2006, 42                                               
17       MILLS;                                                                                                            
18                 (2)  AFTER JUNE 30, 2006, BUT BEFORE JULY 1, 2007, 52                                                   
19       MILLS;                                                                                                            
20                 (3)  AFTER JUNE 30, 2007, 62] mills.                                                                    
21    * Sec. 13. AS 43.50.300 is amended to read:                                                                        
22            Sec. 43.50.300. Excise tax levied. An excise tax is levied on tobacco products                             
23       in the state at the rate of 100 [75] percent of the wholesale price of the tobacco                            
24       products. The tax is levied when a person                                                                       
25                 (1)  brings, or causes to be brought, a tobacco product into the state                                  
26       from outside the state for sale;                                                                                  
27                 (2)  makes, manufactures, or fabricates a tobacco product in the state                                  
28       for sale in the state; or                                                                                         
29                 (3)  ships or transports a tobacco product to a retailer in the state for                               
30       sale by the retailer.                                                                                             
31    * Sec. 14. AS 43.50 is amended by adding a new section to read:                                                    
01            Sec. 43.50.305. Electronic smoking products excise tax; labeling. (a) An                                   
02       excise tax is levied on electronic smoking products in the state at the rate of 75 percent                        
03       of the wholesale price of the electronic smoking product. The tax is levied when a                                
04       person                                                                                                            
05                 (1)  brings, or causes to be brought, an electronic smoking product into                                
06       the state from outside the state for sale;                                                                        
07                 (2)  makes, manufactures, or fabricates an electronic smoking product                                   
08       in the state for sale in the state; or                                                                            
09                 (3)  ships or transports a tobacco product to a retailer in the state for                               
10       sale by the retailer.                                                                                             
11            (b)  An electronic smoking product sold in the state that contains nicotine must                             
12       be prominently labeled "CONTAINS NICOTINE."                                                                       
13    * Sec. 15. AS 43.50.310(b) is amended to read:                                                                     
14            (b)  The tax does not apply to a tobacco product or electronic smoking                                   
15       product if the United States Constitution or other federal laws prohibit the levying of                       
16       the tax on the product by the state.                                                                              
17    * Sec. 16. AS 43.50.320(a) is amended to read:                                                                     
18            (a)  Except as provided in (g) of this section, a person must be licensed by the                             
19       department if the person engages in business as a distributor for a tobacco product or                        
20       electronic smoking product that is subject to the tax.                                                        
21    * Sec. 17. AS 43.50.330(a) is amended to read:                                                                     
22            (a)  On or before the last day of each calendar month, a licensee shall file a                               
23       return with the department. The return must state the number or amount of tobacco                                 
24       products or electronic smoking products sold by the licensee during the preceding                             
25       calendar month, the selling price of the tobacco products or electronic smoking                               
26       products, and the amount of tax imposed on the tobacco products or electronic                             
27       smoking products.                                                                                             
28    * Sec. 18. AS 43.50.335 is amended to read:                                                                        
29            Sec. AS 43.50.335. Tax credits and refunds. The department shall adopt                                     
30       procedures for a refund or credit to a licensee of the tax paid for tobacco products or                       
31       electronic smoking products that have become unfit for sale, are destroyed, or are                            
01       returned to the manufacturer for credit or replacement if the licensee provides proof                             
02       acceptable to the department that the tobacco products or electronic smoking                                  
03       products have not been and will not be consumed in this state.                                                
04    * Sec. 19. AS 43.50.340 is amended to read:                                                                        
05            Sec. 43.50.340. Records. A licensee shall keep a complete and accurate record                            
06       of all tobacco products or electronic smoking products of the licensee subject to the                         
07       tax, including purchase prices, sales prices, the names and addresses of the sellers and                          
08       the purchasers, the dates of delivery, the quantities of tobacco products or electronic                       
09       smoking products, and the trade names and brands. Statements and records required                             
10       by this section must be in the form prescribed by the department, preserved for three                             
11       years, and available for inspection upon demand by the department.                                                
12    * Sec. 20. AS 43.50.390(4) is amended to read:                                                                     
13                 (4)  "tobacco product"                                                                                  
14                      (A)  means                                                                                     
15                           (i) [(A)]  a cigar;                                                                       
16                           (ii) [(B)]  a cheroot;                                                                    
17                           (iii) [(C)]  a stogie;                                                                    
18                           (iv) [(D)]  a perique;                                                                    
19                           (v) [(E)]  snuff and snuff flour;                                                         
20                           (vi) [(F)]  smoking tobacco, including granulated, plug-                                  
21                 cut, crimp-cut, ready-rubbed, and any form of tobacco suitable for                                      
22                 smoking in a pipe or cigarette;                                                                         
23                           (vii) [(G)]  chewing tobacco, including cavendish, twist,                                 
24                 plug, scrap, and tobacco suitable for chewing; or                                                       
25                           (viii) [(H)]  an article or product made of tobacco or a                                  
26                 tobacco substitute, but not including a cigarette as defined in                                         
27                 AS 43.50.170;                                                                                           
28                      (B)  does not include a product that has been approved by                                      
29            the United States Food and Drug Administration for sale as a smoking                                     
30            cessation product, tobacco dependence product, or modified risk tobacco                                  
31            product;                                                                                                 
01    * Sec. 21. AS 43.50.390(5) is amended to read:                                                                     
02                 (5)  "wholesale price" means, for a tobacco product or electronic                                   
03       smoking product                                                                                               
04                      (A)  acquired from a manufacturer, the gross invoice                                       
05            [ESTABLISHED] price, including all federal excise taxes, at [FOR] which                                  
06            the [A] manufacturer sells a tobacco product or electronic smoking product                           
07            to an unaffiliated [A] distributor after a deduction of a trade discount or other                
08            reduction received by the distributor [FOR QUANTITY OR CASH IF THE                                           
09            MANUFACTURER'S ESTABLISHED PRICE IS ADEQUATELY                                                               
10            SUPPORTED BY BONA FIDE ARM'S LENGTH SALES AS                                                                 
11            DETERMINED BY THE DEPARTMENT]; or                                                                            
12                      (B)  not acquired from a manufacturer, the gross invoice                                   
13            price, including all federal excise taxes, after a deduction of a trade                                  
14            discount or other reduction [AS DETERMINED BY THE DEPARTMENT,                                            
15            FOR WHICH TOBACCO PRODUCTS OF COMPARABLE RETAIL PRICE                                                        
16            ARE SOLD TO DISTRIBUTORS IN THE ORDINARY COURSE OF                                                           
17            TRADE IF THE MANUFACTURER'S ESTABLISHED PRICE DOES NOT                                                       
18            MEET THE STANDARDS OF (A) OF THIS PARAGRAPH].                                                                
19    * Sec. 22. AS 43.50.390 is amended by adding a new paragraph to read:                                              
20                 (6)  "electronic smoking product"                                                                       
21                      (A)  means a component, solution, vapor product, or other                                          
22            related product of an electronic cigarette, electronic cigar, electronic cigarillo,                          
23            electronic pipe, or other similar product that is manufactured and sold for the                              
24            purpose of being aerosolized to deliver nicotine to the person inhaling; if the                              
25            product is sold as a disposable integrated unit containing a power source and                                
26            delivery system, or as a kit containing a refillable electronic smoking system                               
27            and power source, the entire unit shall be considered an electronic smoking                                  
28            product for the purposes of this definition;                                                                 
29                      (B)  does not include a                                                                            
30                           (i)  product that is subject to taxation under                                                
31                 AS 43.61.010 - 43.61.050 that does not contain nicotine;                                                
01                           (ii)  drug, product, or combination product approved for                                      
02                 sale by the United States Food and Drug Administration, as those terms                                  
03                 are defined in 21 U.S.C. 301-392 (Food, Drug, and Cosmetic Act); or                                     
04                           (iii)  product that has been approved by the United                                           
05                 States Food and Drug Administration for sale as a smoking cessation                                     
06                 product, tobacco dependence product, or modified risk tobacco product.                                  
07    * Sec. 23. AS 43.60.010(a) is amended to read:                                                                     
08            (a)  Except as provided in (c) of this section, every brewer, distiller, bottler,                            
09       jobber, retailer, wholesaler, or manufacturer who sells alcoholic beverages in the state                          
10       or who consigns shipments of alcoholic beverages into the state, whether or not the                               
11       alcoholic beverages are brewed, distilled, bottled, or manufactured in the state, shall                           
12       pay on all malt beverages (alcoholic content of one percent or more by volume),                                   
13       wines, and hard or distilled alcoholic beverages, the following taxes:                                            
14                 (1)  malt beverages at the rate of $2.14 [$1.07] a gallon or fraction of a                          
15       gallon;                                                                                                           
16                 (2)  cider with at least 0.5 percent alcohol by volume but not more than                                
17       seven percent alcohol by volume, at the rate of $2.14 [$1.07] a gallon or fraction of a                       
18       gallon;                                                                                                           
19                 (3)  wine or other beverages, other than beverages described in (1) or                                  
20       (2) of this subsection, of 21 percent alcohol by volume or less, at the rate of $5 [$2.50]                    
21       a gallon or fraction of a gallon; and                                                                             
22                 (4)  other beverages having a content of more than 21 percent alcohol                                   
23       by volume at the rate of $25.60 [$12.80] a gallon.                                                            
24    * Sec. 24. AS 43.60.010(c) is amended to read:                                                                     
25            (c)  A brewer shall pay a tax at the rate of 70 [35] cents a gallon on sales of the                      
26       first 60,000 barrels of beer sold in the state each fiscal year beginning July 1, 2001, for                       
27       beer produced in the United States if the producing brewery meets the qualifications of                           
28       26 U.S.C. 5051(a)(2). To qualify for the tax rate under this subsection, the brewer                               
29       must file with the department a copy of an Alcohol and Tobacco Tax and Trade                                      
30       Bureau acknowledged copy of the brewer's notice of intent to pay reduced rate of tax                              
31       required under 27 C.F.R. 25.167 for the calendar year in which the fiscal year begins                             
01       for which the partial exemption is sought. If proof of eligibility is not received by the                         
02       department before June 1, the tax rate under this subsection does not apply until the                             
03       first day of the second month after the month the notice is received by the department.                           
04       For purposes of applying this subsection, a barrel of beer may contain not more than                              
05       31 gallons.                                                                                                       
06    * Sec. 25. AS 43.60.040(a) is amended to read:                                                                     
07            (a)  Each brewer, distiller, bottler, jobber, wholesaler, or manufacturer is                                 
08       primarily liable for the payment of the excise taxes on alcoholic beverages sold, and                             
09       shall furnish a good and sufficient surety bond in an amount as determined by [OF                             
10       $25,000 PAYABLE TO] the department and approved by the Department of Law. If a                                    
11       licensee [WHOLESALER] fails to pay the tax to the state the licensee                                      
12       [WHOLESALER] forfeits the bond and the licensee's [WHOLESALER'S] license                                      
13       shall be revoked. The department, in its discretion, may issue permits in place of                                
14       bonds to resident holders of wholesale, malt beverage, and wine licenses doing                                    
15       business wholly in the state who pay the tax before shipment.                                                     
16    * Sec. 26. AS 43.65.010(a) is amended to read:                                                                   
17            (a)  A person prosecuting or attempting to prosecute, or engaging in the                                     
18       business of mining in the state shall obtain a license from the department. All new                               
19       mining operations are exempt from the tax levied by this chapter for two [THREE                               
20       AND ONE-HALF] years after production begins.                                                                      
21    * Sec. 27. AS 43.65.010(c) is amended to read:                                                                     
22            (c)  The license tax on mining is as follows: on [UPON] the net income of the                            
23       taxpayer from the property in the state, computed with allowable depletion, plus                                  
24       royalty received in connection with mining property in the state                                                  
25       over $40,000 and not over $50,000 ............................................................... 3 percent       
26       over $50,000 and not over $100,000 ......................................................... $1,500 plus          
27         5 percent of the excess over $50,000                                                                            
28       over $100,000 ............................................................................................. $4,000
29         9 [7] percent of the excess over $100,000.                                                                  
30    * Sec. 28. AS 43.65.030 is amended to read:                                                                        
31            Sec. 43.65.030. Applications and [APPLICATION FOR] renewals; fees.                                     
01       The fee for a mining license and for each renewal is $50. Application for renewal of                          
02       a mining license shall be made before January 1 [MAY 1] of each year.                                         
03    * Sec. 29. AS 43.75.015(a) is amended to read:                                                                     
04            (a)  A person engaged in a fisheries business is liable for and shall pay the tax                            
05       levied by this section on the value of each of the following fisheries resources                                  
06       processed during the year at the rate set out after each:                                                         
07                 (1)  salmon canned at a shore-based fisheries business - five [FOUR]                                
08       and one-half percent;                                                                                             
09                 (2)  salmon processed by a shore-based fisheries business, except                                       
10       salmon for which the tax is due under (1) of this subsection, and all other fisheries                             
11       resources processed by a shore-based fisheries business - four [THREE] percent;                               
12                 (3)  fisheries resources processed by a floating fisheries business - six                           
13       [FIVE] percent.                                                                                                   
14    * Sec. 30. AS 43.75.015(d) is amended to read:                                                                     
15            (d)  Instead of the taxes levied under (a) or (b) of this section, a person who                              
16       processes a fishery resource under a direct marketing fisheries business license is                               
17       liable for and shall pay a tax equal to                                                                           
18                 (1)  one percent of the value of the developing commercial fish species                                 
19       processed during the year; and                                                                                    
20                 (2)  four [THREE] percent of the value of a commercial fish species                                 
21       not subject to (1) of this subsection.                                                                            
22    * Sec. 31. AS 43.75.030(b) is amended to read:                                                                     
23            (b)  The return shall be made on a [THE BASIS OF THE] calendar year basis                            
24       and submitted to the department [AT JUNEAU] before April 1 after the close of the                             
25       calendar year.                                                                                                    
26    * Sec. 32. AS 43.75.130(a) is amended to read:                                                                     
27            (a)  The amount of tax revenue equal to one percent of the value of each                                 
28       fishery taxed under this chapter shall be deposited into the general fund. Except                             
29       as provided in (d) of this section, and not including the revenue equal to one                                
30       percent of the value of each fishery taxed under this section deposited in the                                
31       general fund, the commissioner shall pay                                                                      
01                 (1)  to each unified municipality and to each city located in the                                       
02       unorganized borough, 50 percent of the amount of tax revenue collected in the                                     
03       municipality from taxes levied under this chapter;                                                                
04                 (2)  to each city located within a borough, 25 percent of the amount of                                 
05       tax revenue collected in the city from taxes levied under this chapter; and                                       
06                 (3)  to each borough                                                                                    
07                      (A)  50 percent of the amount of tax revenue collected in the                                      
08            area of the borough outside cities from taxes levied under this chapter; and                                 
09                      (B)  25 percent of the amount of tax revenue collected in cities                                   
10            located within the borough from taxes levied under this chapter.                                             
11    * Sec. 33. AS 43.77.010 is amended to read:                                                                        
12            Sec. 43.77.010. Landing tax. A person who engages or attempts to engage in a                               
13       floating fisheries business in the state and who owns a fishery resource that is not                              
14       subject to AS 43.75 but that is brought into the jurisdiction of, and first landed in, this                       
15       state is liable for and shall pay a landing tax on the value of the fishery resource. The                         
16       amount of the landing tax is                                                                                      
17                 (1)  for a developing commercial fish species, as defined under                                         
18       AS 43.75.290, one percent of the value of the fishery resource at the place of landing;                           
19                 (2)  for a fish species other than a developing commercial fish species,                                
20       four [THREE] percent of the value of the fishery resource at the place of the landing.                        
21    * Sec. 34. AS 43.77.060(a) is amended to read:                                                                     
22            (a)  The amount of tax revenue equal to one percent of the value of each                                 
23       fishery taxed under this chapter shall be deposited into the general fund. Subject                            
24       to appropriation by the legislature and except as provided in (b) of this section, and                        
25       not including the revenue equal to one percent of the value of each fishery taxed                             
26       under this section deposited in the general fund, the commissioner shall pay to each                          
27                 (1)  unified municipality and to each city located in the unorganized                                   
28       borough, 50 percent of the amount of tax revenue collected from taxes levied under                                
29       this chapter on the fishery resource landed in the municipality and accounted for under                           
30       AS 43.77.050(b);                                                                                                  
31                 (2)  city located within a borough, 25 percent of the amount of the tax                                 
01       revenue collected from taxes levied under this chapter on fishery resources landed in                             
02       the city and accounted for under AS 43.77.050(b); and                                                             
03                 (3)  borough                                                                                            
04                      (A)  50 percent of the amount of the tax revenue collected from                                    
05            taxes levied under this chapter on fishery resources landed in the area of the                               
06            borough outside cities and accounted for under AS 43.77.050(b); and                                          
07                      (B)  25 percent of the amount of the tax revenue collected from                                    
08            taxes levied under this chapter on fishery resources landed in cities located                                
09            within the borough and accounted for under AS 43.77.050(b).                                                  
10    * Sec. 35. AS 43.77.060(b) is amended to read:                                                                     
11            (b)  The amount of tax revenue equal to one percent of the value of each                                 
12       fishery taxed under this chapter shall be deposited into the general fund.                                    
13       Notwithstanding the provisions of (a)(2) and (a)(3)(B) of this section, and subject to                            
14       appropriation by the legislature, and not including the revenue equal to one percent                          
15       of the value of each fishery taxed under this section deposited in the general fund,                          
16       the commissioner shall pay to each                                                                                
17                 (1)  city that is located in a borough incorporated after January 1, 1994,                              
18       the following percentages of the tax revenue collected from taxes levied under this                               
19       chapter on fishery resources landed in the city and accounted for under                                           
20       AS 43.77.050(b):                                                                                                  
21                      (A)  45 percent of the tax revenue collected during the calendar                                   
22            year in which the borough is incorporated;                                                                   
23                      (B)  40 percent of the tax revenue collected during the first                                      
24            calendar year after the calendar year in which the borough is incorporated;                                  
25                      (C)  35 percent of the tax revenue collected during the second                                     
26            calendar year after the calendar year in which the borough is incorporated; and                              
27                      (D)  30 percent of the tax revenue collected during the third                                      
28            calendar year after the calendar year in which the borough is incorporated; and                              
29                 (2)  borough that is incorporated after January 1, 1994, the following                                  
30       percentages of the tax revenue collected from taxes levied under this chapter on                                  
31       fishery resources landed in the cities located within the borough and accounted for                               
01       under AS 43.77.050(b):                                                                                            
02                      (A)  five percent of the tax revenue collected during the                                          
03            calendar year in which the borough is incorporated;                                                          
04                      (B)  10 percent of the tax revenue collected during the first                                      
05            calendar year after the calendar year in which the borough is incorporated;                                  
06                      (C)  15 percent of the tax revenue collected during the second                                     
07            calendar year after the calendar year in which the borough is incorporated; and                              
08                      (D)  20 percent of the tax revenue collected during the third                                      
09            calendar year after the calendar year in which the borough is incorporated.                                  
10    * Sec. 36. The uncodified law of the State of Alaska enacted in sec. 4, ch. 48, SLA 1997, as                       
11 repealed and reenacted by sec. 42, ch.1, FSSLA 2004, is repealed and reenacted to read:                                 
12            Sec. 4. AS 43.50.190(a) is amended to read:                                                                  
13            (a)  There is levied an excise tax on each cigarette imported or acquired in this                            
14       state,                                                                                                            
15                 (1)  after September 30, 1997, but before January 1, 2005, 47.5 mills;                                  
16                 (2)  after December 31, 2004, but before July 1, 2006, 77.5 mills;                                      
17                 (3)  after June 30, 2006, but before July 1, 2007, 87.5 mills;                                          
18                 (4)  after June 30, 2007, but before July 1, 2016, 97.5 mills;                                          
19                 (5)  after June 30, 2016, 147.5 mills.                                                                  
20    * Sec. 37. AS 27.30.080 and AS 38.05.212(b)(2) are repealed.                                                       
21    * Sec. 38. The uncodified law of the State of Alaska is amended by adding a new section to                         
22 read:                                                                                                                   
23       APPLICABILITY. (a) The changes to the applicability of the exploration incentive                                  
24 credit made in AS 27.30.030(a) and (b), as amended by secs. 2 and 3 of this Act,                                        
25 AS 27.30.040, as amended by sec. 4 of this Act, AS 27.30.050, as amended by sec. 5 of this                              
26 Act, AS 38.05.150(d), as amended by sec. 6 of this Act, and the repeal of AS 27.30.080 and                              
27 AS 38.05.212(b)(2) by sec. 37 of this Act, apply to a royalty payment period beginning on or                            
28 after the effective date of sec. 2 of this Act.                                                                         
29       (b)  AS 43.40.010(a), as amended by sec. 7 of this Act, applies to motor fuel sold or                             
30 transferred in the state on or after the effective date of sec. 7 of this Act.                                          
31       (c)  AS 43.40.010(b), as amended by sec. 8 of this Act, applies to motor fuel                                     
01 consumed by a user on or after the effective date of sec. 8 of this Act.                                                
02       (d)  AS 43.40.030(a), as amended by sec. 9 of this Act, applies to a motor fuel tax                               
03 refund on motor fuel used on or after the effective date of sec. 9 of this Act.                                         
04       (e)  AS 43.50.190(a), as amended by sec. 12 of this Act, and AS 43.50.300, as                                     
05 amended by sec. 13 of this Act, apply to tobacco products sold on or after the effective date of                        
06 secs. 12 and 13 of this Act.                                                                                            
07       (f)  AS 43.50.305, added by sec. 14 of this Act, applies to electronic smoking products                           
08 sold on or after the effective date of sec. 14 of this Act.                                                             
09       (g)  AS 43.50.330(a), as amended by sec. 17 of this Act, applies to the first monthly                             
10 return submitted after the first full month after the effective date of sec. 17 of this Act.                            
11       (h)  AS 43.60.010(a), as amended by sec. 23 of this Act, and AS 43.60.010(c), as                                  
12 amended by sec. 24 of this Act, apply to alcoholic beverages sold on or after the effective date                        
13 of secs. 23 and 24 of this Act.                                                                                         
14       (i)  AS 43.60.040(a), as amended by sec. 25 of this Act, applies to surety bonds on or                            
15 after the effective date of sec. 25 of this Act.                                                                        
16       (j)  AS 43.65.010(a), as amended by sec. 26 of this Act, applies to a mining operation                            
17 that begins production on or after the effective date of sec. 26 of this Act.                                           
18       (k)  AS 43.65.010(c), as amended by sec. 27 of this Act, applies to net income of the                             
19 taxpayer from property in the state during a taxable year that begins on or after the effective                         
20 date of sec. 27 of this Act.                                                                                            
21       (l)  AS 43.75.015(a) and 43.75.015(d), as amended by sec. 29 and 30 of this Act, apply                            
22 to a fisheries resource processed on or after the effective date of secs. 29 and 30 of this Act.                        
23       (m)  AS 43.77.010, as amended by sec. 33 of this Act, applies to a fisheries resource                             
24 landed in the state on or after the effective date of sec. 33 of this Act.                                              
25    * Sec. 39. The uncodified law of the State of Alaska is amended by adding a new section to                         
26 read:                                                                                                                   
27       TRANSITION: REGULATIONS. (a) The Alaska Commercial Fisheries Entry                                                
28 Commission, the Department of Fish and Game, the Department of Revenue, and the                                         
29 Department of Natural Resources may adopt regulations necessary to implement the changes                                
30 made by this Act. The regulations take effect under AS 44.62 (Administrative Procedure Act),                            
31 but not before the effective date of the law implemented by the regulation.                                             
01    * Sec. 40. Section 39 of this Act takes effect immediately under AS 01.10.070(c).                                  
02    * Sec. 41. Except as provided in sec. 40 of this Act, this Act takes effect January 1, 2017.