Leave the cruise ship head tax alone

Posted: Friday, April 16, 2010

Gov. Sean Parnell's proposal to reduce the $50 cruise ship head tax is a bad deal for Alaska and potentially self-serving for him and our elected legislators. If legislators approve Governor Parnell's proposal, they too should be held accountable by the people of Alaska for overriding a "citizens' initiative" and for giving up tens of millions of dollars of tax revenue, important to the tourism infrastructure of many of Alaska's coastal communities.

Governor Parnell's lawsuit settlement implies the governor believes the passenger head tax is on legal shaky ground. His belief lacks logic. Before the Cruiseship Initiative ever became a people's initiative, it had to be vetted by the Alaska Department of Law, thus deemed legal (i.e. defendable). If the State's best lawyers saw the head tax as legal in 2006, why wouldn't these same lawyers be ready and able to defend against any legal challenge by the cruise industry in 2010?

The cruise industry makes the ridiculous claim that Alaska's $50 head tax and Alaska's clean water regulations are "more burdensome and more costly than anywhere else on earth". A $50 tax on a $2,400 cruise is a mere 2 percent. It is so inconsequential, it is not even mentioned on the cruise line websites except for a small asterisk that states, "Prices do not include government fees and taxes". Their websites clearly state that the cruise companies may add an extra $70/person fuel surcharge if the price of oil exceeds $70/bbl. Passengers are also quietly nicked a couple of hundred dollars for "gratuities". If "additional costs" are keeping passengers from cruising Alaska, then the industry has cost cutting options other than Alaska's small slice of the pie.

Visitor taxes are as American as apple pie. As the owner of a small business in southeast Alaska, I make an annual trip to Seattle to purchase specialty items not available locally and to be a tourist. As part of my routine, I rent a car for a week at SeaTac airport. A compact car rents for $103 per week, plus $71.15 in taxes and fees. I pay 41 percent in taxes and fees, I pay it every year and I keep coming back. For a number of years, I was charged an extra dollar to pay for Safeco Stadium, which I never used. Compare Seattle's 41 percent to the 2 percent head tax paid by visitors to the great State of Alaska. Are we really expected to believe that our $50 head tax makes Alaska the most costly place on earth?

It is usually dangerous in politics to speculate on motive behind any political decision, however it will be interesting to watch if Governor Parnell's proposal or legislators' approval is parlayed into campaign cash in this brave new world of unlimited corporate campaign contributions brought to you by the Roberts/Alito U.S. Supreme Court. Follow the campaign money trail at Alaska Public Office Commission's website when deciding who deserves your vote this fall. I'll be voting for candidates who didn't drink from the cruise ship Kool-aid.

• Tim June is a Haines resident.

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