Legislature(2001 - 2002)
03/20/2002 01:15 PM JUD
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HJR 36 - CONSTITUTIONAL AMENDMENT : TAX CAPS Number 0441 CHAIR ROKEBERG announced that the next order of business would be SPONSOR SUBSTITUTE FOR HOUSE JOINT RESOLUTION NO. 36, Proposing an amendment to the Constitution of the State of Alaska relating to limiting the rate of state individual income taxes and sales taxes. Number 0420 CHAIR ROKEBERG moved to adopt committee substitute (CS) for SSHJR 36, version 22-LS1402\P, Kurtz, 3/20/02, as a work draft. There being no objection, Version P was before the committee. CHAIR ROKEBERG remarked that in Version P, [subsection] (a) of Section 1 has been rewritten and now reads: "The rate of an individual income tax levied by the State may not exceed five percent of an individual's taxable income, as that term is defined in federal law." He indicated that this constitutes a flat tax rate not to exceed 5 percent. REPRESENTATIVE JAMES indicated that using an individual's [federal] taxable income as a basis by which to determine whether a state income tax had reached its cap was fine with her. Number 0092 REPRESENTATIVE COGHILL made a motion to adopt Representative Ogan's Amendment 1, 22-LS1402\L.1, Kurtz, 2/22/02, [which would need to be altered to conform with line numbers in Version P]. Amendment 1 read: Page 1, lines 1 - 2: Delete "limiting the rate of" Page 1, line 6, following "Tax Caps" Insert "; Voter Approval of New Taxes and Rate Increases" Page 1, following line 14: Insert a new subsection to read: "(c) A new individual income tax or sales tax or an increase in the rate of levy of an individual income tax or sales tax enacted by the legislature does not take effect unless ratified by a majority of the voters at the first statewide election held following enactment of the tax or the tax increase." REPRESENTATIVE COGHILL explained that Amendment 1 simply asks that any individual income tax or sales tax, or any increase in such, would not take effect unless ratified by a majority of the voters at the next statewide election held following enactment by the legislature of the tax or tax increase. He remarked that because citizens don't currently pay a state tax, they are disconnected from state government; he suggested that Amendment 1 would help reestablish that connection. TAPE 02-34, SIDE A Number 0016 REPRESENTATIVE BERKOWITZ mentioned that he was pleased to see that some of his colleagues were interested in putting matters to a public vote, and that he hoped they would "carry that logic through in other matters." He remarked, however, that he is concerned with whether [Amendment 1] would fit in with the current Alaska State Constitution, which precludes the public from voting on appropriation matters. CHAIR ROKEBERG said he tends to agree that [Amendment 1] cedes the legislature's power of appropriation to the public and, thus, the legislature would not be doing its job by adopting it. REPRESENTATIVE JAMES indicated agreement. REPRESENTATIVE MEYER remarked that the Municipality of Anchorage (MOA) is doing something similar to what is being attempted via Amendment 1. REPRESENTATIVE JAMES pointed out that a statewide issue cannot be compared to municipal issue. She opined that adoption of Amendment 1 would be abdicating the legislature's responsibility. She also noted that one of the problems with putting an issue before the voters is that not everybody that can vote does so. REPRESENTATIVE COGHILL offered that having an issue like Amendment 1 on the ballot might increase voter turnout. REPRESENTATIVE JAMES argued, however, that less than 20 percent of eligible voters even voted [on the advisory vote of September 1999] regarding use of the permanent fund. And so although 83 percent voted "No," it was merely 83 percent of a very small portion of the population. CHAIR ROKEBERG, after noting that he was speaking in defense of the Alaska State Constitution, said that Amendment 1 would be abdicating the legislature's responsibility; he then asked Representative Coghill to withdraw Amendment 1. Number 0312 REPRESENTATIVE COGHILL, after arguing that Amendment 1 is merely "ratification" rather than "installation," nonetheless withdrew the motion to adopt Amendment 1. Number 0351 REPRESENTATIVE BERKOWITZ moved to report committee substitute for SSHJR 36, version 22-LS1402\P, Kurtz, 3/20/02, out of committee [with individual recommendations and the accompanying fiscal note]. CHAIR ROKEBERG objected for the purpose of stating: "What this does is make this a 5 percent cap on an individual's taxable income, as opposed to the aggregate." CHAIR ROKEBERG then withdrew his objection and noted that there were no further objections. Therefore, CSSSHJR 36(JUD) was reported from the House Judiciary Standing Committee.