Gov. Palin unveils new oil and gas tax plan

Filed from Houston 9/5/2007 3:32:10 PM GMT

USA/ALASKA: Alaska Governor Sarah Palin yesterday unveiled a new oil and gas tax plan for the state following an extensive evaluation of the current Petroleum Profits Tax (PPT) by the Department of Revenue. The evaluation showed the state is expected to receive US$800 million less for the current fiscal year than would have been expected under the actual PPT documentation presented by the prior administration.

The new plan, called Alaska’s Clear and Equitable Share, or ACES, is a hybrid of a gross and net tax system and includes a minimum 10 percent tax based on gross receipts for the North Slope’s legacy fields with a 25 percent net tax to encourage new development and reinvestment in existing infrastructure. Palin said ACES also allows for tax credits on future work, and it restricts capital expense deductions to scheduled maintenance, while implementing strong audit and information sharing provisions.”In case there is any question on where we stand, let me be clear - PPT doesn’t work as promised,” said Palin. “There are those who would say we should do nothing and that we should continue the PPT experiment. Doing nothing is not an option. This clearer, equitable plan fulfills our state constitution mandate that says I’m to develop our resources for the maximum benefit of all Alaskans.”
Palin also announced the Special Session will be held in Juneau and urged lawmakers to hold oil tax committee hearings and public testimony in Anchorage and Fairbanks. The Special Session is slated to begin Oct. 18.