Wednesday, February 15, 2017

Delta, UPS join Alaska Airlines in opposing aviation fuel tax in state of Alaska

Alaska Gov. Bill Walker’s proposal to triple the state’s jet fuel and aviation gasoline taxes by 2018 is causing turbulence in the state’s flying community, the Juneau Empire newspaper reports.

The state’s aviation advisory board supports the tax hike. So do the Alaska Air Carriers Association, Alaska Airmen Association and the Aircraft Owners and Pilots Association.

However, some of the state’s biggest names in aviation, including SeaTac-based Alaska Airlines, Atlanta-based Delta Air Lines and the United Parcel Service, are opposing the new tax.

If enacted by the Alaska Legislature, the tax measures would raise up to $80 million more per year to help erase a $2.7 billion state deficit by increasing state taxes on all motor fuels — gasoline and marine diesel as well as aviation fuel. Alaska Airlines is the biggest airline serving Alaska and the company enjoys a historically close relationship with state residents, businesses, politicians and airports.

The governor has vowed money raised under the new tax would be dedicated to infrastructure in the places they were collected. Aviation fuel proceeds would go to airports, for example, while gas taxes would be reserved for road repairs.

Alaska Airlines regional vice-president Marilyn Romano, in a letter written to outline the airline's opposition to the tax, said the company’s own calculations indicate that Alaska Airlines alone would pay 45 percent of all new taxes collected if either of two bills, HB 60 or SB 25, pass the Legislature.

In a joint letter opposing the tax, Nick D’Andrea, vice president of UPS public affairs, and Dana Debel, a managing director for Delta, said “the proposed 300 percent increase in the jet fuel tax" would exacerbate a fragile and complex system where taxes are collected at the state's biggest airports and redistributed to the smaller ones that don't charge landing fees.

Both Alaska Airlines and Delta have their corporate lobbyists deployed to fight the measures, the Alaskan newspaper reported.

For more details on the proposed taxes and why the airlines are fighting them because they believe they're unfair, read the Juneau Empire story here.

(Andrew McIntosh - Puget Sound Business Journal)

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