Lawmakers: Clear way for tourist tax

Resolution aims to protect proposed ship passenger tax

Posted: Wednesday, March 22, 2006

An Alaska lawmaker wants to be sure a proposed statewide cruise ship tax referendum is legal, and is asking Congress to clarify its position on the matter.

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The Alaska House Transportation Committee on Tuesday passed Palmer Republican Rep. Carl Gatto's resolution meant to protect a proposed head tax from legal challenges if voters approve it.

The initiative slated to be on the November ballot would charge cruise ship companies operating in Alaska a $50 tax per passenger.

The Maritime Transportation Security Act of 2002 contains a provision that was designed to invalidate a tax levied by Yakutat on cruise ships that did not call on any of its ports but still sailed through its waters.

Gatto, sponsor of House Joint Resolution 18, wrote the legislation to ask Congress to clarify or repeal the measure. The provision, inserted by Sen. Ted Stevens, R-Alaska, says taxes cannot be levied on the industry unless the vessels call on a city's ports.

"In the meantime, that specific provision has been interpreted rather broadly. It has the potential to invalidate a number of taxes imposed nationwide," said Cody Rice, aide to Gatto.

An argument has been made that the measure in the act could lead to courts invalidating the ballot initiative, Gatto said.

The cruise ship industry opposes the ballot initiative, saying the tax would be passed on to passengers and some may choose less expensive trips.

"For me it was a state's rights issue," said Gatto, adding he feared the federal government would use the opportunity to tell Alaska it could not tax the cruise ship industry.

"I hate referendum government," said House Transportation Co-Chairman Jim Elkins, R-Ketchikan. "But if the referendum gets elected, I think we're going to need clarity."

Stevens tried but failed to address these concerns over the provision through last year's Coast Guard Act, Rice said. Stevens' office said the senator is looking at trying it again this year, he added.

• Andrew Petty can be reached at andrew.petty@juneauempire.com.



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