Legislature(2015 - 2016)

2016-05-27 House Journal

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2016-05-27                     House Journal                      Page 2989
HB 4006                                                                                                                       
HOUSE BILL NO. 4006 by the House Rules Committee by request of                                                                  
the Governor, entitled:                                                                                                         
     "An Act relating to the fisheries business tax and fishery resource                                                        
     landing 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; relating to refunds of the fisheries                                                      

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     business tax and the fishery resource landing tax to local                                                                 
     governments; and providing for an effective date."                                                                         
was read the first time and referred to the Finance Committee.                                                                  
The following fiscal note(s) apply:                                                                                             
1.  Fiscal, Dept. of Revenue                                                                                                    
The Governor's transmittal letter dated May 26, 2016, follows:                                                                  
"Dear Speaker Chenault:                                                                                                         
Under the authority of Article III, Section 18 of the Alaska                                                                    
Constitution, I am transmitting a bill relating to a tax on fisheries                                                           
business and fishery resource landing and the annual fee for the                                                                
issuance and renewal of entry permits or interim-use permits.                                                                   
First, the bill would amend AS 16.43.160 related to fees for                                                                    
commercial fishing entry permits or interim-use permits. The Alaska                                                             
Commercial Fisheries Entry Commission (Commission) sets the                                                                     
annual fee for permits. Current law limits the annual base fee to not                                                           
less than $30 or not more than $3,000; the bill would remove the                                                                
minimum and maximum limits. This part of the bill would take effect                                                             
January 1, 2017, to conform to the Commission's regulatory schedule                                                             
and to better meet the needs of the commercial fishing community.                                                               
The bill would increase the tax rates of the fisheries business tax                                                             
(AS 43.75.015) and the fishery resource landing tax (AS 43.77.010).                                                             
Some developing fisheries are exempted from the increase. The tax                                                               
rates covered by these statutes vary from three percent to five percent,                                                        
depending on the type of fishery. The bill would increase those tax                                                             
rates by one percentage point. As to specific fisheries, the fisheries                                                          
business tax on shore based canned salmon would be five percent (the                                                            
current rate is four percent), the other fisheries resources would be                                                           
four percent (up from three percent) while the tax levied on a person                                                           
who processes a fishery resource would pay a tax of four percent (the                                                           
current rate is three percent) of the value of a commercial fish species.                                                       
In addition, the bill would change the revenue sharing tax refund to                                                            
local governments. Currently, the revenue generated by these taxes is                                                           

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split evenly between the State and the municipalities where the                                                                 
fisheries are located. The bill would exempt one percent of the tax                                                             
revenue collected from the revenue sharing arrangement, but the                                                                 
remaining percentage of the tax revenue would still be paid to the local                                                        
governments where the fisheries resource is landed.                                                                             
Thank you for your consideration of this measure.                                                                               
Bill Walker