Balance the State Budget With Taxes, Not Cuts, Say Older Alaskans

Alaskans have not paid a state income tax since 1980 because soaring oil revenues have fattened the state general fund. But three years of declining oil production and oil prices have contributed to a state budget deficit. To avoid cutting state programs and services, Governor Mike Dunleavy and the state legislature are considering a number of tax proposals. 

Key Findings

• AARP members are very aware of Alaska's long-term budget challenges — nearly four out of five (77%) have heard "a great deal" or "a fair amount" about it in the last year. Nearly nine out of 10 (86%) describe Alaska's economy as "only fair" or "poor."

• There is very little appetite for the specific cuts tested in this survey. Cuts to state spending on local government funding, public safety, education, transportation, health services for children and low-income families, and home care services for seniors are opposed by 71% to 86% of AARP members. A plurality to a majority "strongly oppose" these cuts.

• Two-thirds of AARP members (67%) support a 3% state sales tax. Support is high across the demographic subgroups. However, informing supporters of a state sales tax that some communities would be paying a local sales tax in addition to a new state sales tax caused overall support for a sales tax to drop to 43%. Informing supporters that a sales tax creates a burden on low-income families also shifted opinion but to a lesser degree — 58% overall would still support a sales tax.

• A state graduated income tax is supported by a wide margin (+18% support) overall. Both sides of the income tax issue have strong opinions, but "strong support" exceeds "strong opposition" by a margin of 8%. 

• Capping Permanent Fund Dividend (PFD) checks to help balance the state budget and maintain state services is supported by a margin of 15% overall.

• AARP members support increasing taxes on oil and gas companies by a very wide margin (+39% support), and the majority of members (51%) "strongly support" this tax increase.

• AARP members in Alaska prefer to balance the state budget by increasing taxes on oil companies. A plurality (42%) rank it as their top choice, and four out of five (80%) rank it among their top three choices. After their preference for raising oil company taxes, members prefer a sales tax, an income tax, and capping the PFD. Cuts to state spending is ranked last, with only 38% ranking cuts as one of their top three choices. ​

Methodology

AARP commissioned Dittman Research in Alaska to gauge the support or opposition for some of these proposals among 1,000 Alaskans ages 50 and older.  Almost half (n=428) the sample indicated they or their spouse/partner are AARP members. This report summarizes the responses of those 428 Alaskans. 

For more information, please contact Jennifer Sauer at jsauer@aarp.org. For media inquiries, please contact media@aarp.org.