Thursday’s Friday Fact Check: Paskvan Peddles Petroleum Prevarications.

In News by wp_sysadmin

If Alaska were just like Texas…

Prevarication:  when someone tells a lie, especially in a sneaky way.

In what can only be described as an effort to mislead Alaskans, former Senator Joe Paskvan has penned yet another opinion piece about the upcoming oil tax initiative- with an interesting new twist – if only Alaska was like Texas.

A few things to remember when considering Paskvan’ s piece:

  • Under SB 21 the  base tax rate was INCREASED from 25% to 35%. ( A significant fact the Paskvan and his pals tend to forget). 
  • Under SB 21 the per barrel credit was implemented. 
    • The credit decreases  as prices increase.  Higher prices, higher taxes.
    • The credit  increases at low prices. Low prices, lower taxes. 
    • It’s not a subsidy – the per barrel credit keeps Alaska competitive.
  • Alaska and Texas aren’t the same.  Suggesting they should receive the same percentage of market price is nonsensical: 
    • Alaska’s costs are more than $15/bbl higher than Texas
    • At $50/bbl oil price, pre-tax profits in Alaska would be $17/bbl.  In Texas?  $32/bbl
    • Taking 30% of the market price in taxes would leave producers in Texas with $17/bbl. In Alaska?  $2/bbl.

Producers in Texas make much more after tax than they do in Alaska.  Ignoring all the differences between Alaska and Texas tells a story that is….well, a prevarication. 

P.S.   – Governor Walker and the legislature took the actions that led to the “massive reductions of the PFD annual payments”.  Suggesting that SB 21 is the culprit is just another prevarication.