In November 2025, Mayor Suzanne LaFrance briefly introduced a 3% sales tax proposal to the Anchorage Assembly. ISER researchers examined the implications and outcomes of the proposal, identifying several key conclusions:
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Alaskans will soon vote on whether to keep the state's new oil production tax, known as SB 21, that went into effect this year, or to go back to the previous tax, called Alaska's Clear and Equitable Share (ACES). A new analysis by Matthew Berman, professor of economics at ISER, looks broadly at how the new tax compares with the tax it replaced, examining not only how future state revenues might differ under the two systems, but also other differences—how the two compare with older production tax regimes and how government-industry relationships vary under the two systems.
He finds that SB 21 has a number of drawbacks, compared with earlier systems, including its administrative complexity and its low effective tax rate for new oil—which means that the state's percentage share of the value of the oil is likely to decline over time. He identifies the one major problem with ACES as its high effective tax rates, which could hamper new investment.
Overall, Dr. Berman concludes that the tax system in place before ACES—the Petroleum Profits Tax, replaced by ACES in 2007—is arguably a better fit for Alaska, because it had neither the high tax rates of ACES nor the administrative complexity of SB 21.
Download the full analysis, Comparing Alaska's Oil Production Taxes: Incentives and Assumptions (PDF, 684KB). If you have questions, get in touch with Gunnar Knapp, ISER's director, at gpknapp@uaa.alaska.edu or 907-786-7717.
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Updated on June 27, 2014
On Friday, June 27, Scott Goldsmith, professor emeritus of economics at ISER, will host a technical workshop, open to the public, to discuss the model used in his recent analysis (pdf, 2.6MB) of future revenues under the state’s old method of taxing oil production, called ACES, and the new method that went into effect in January, known as SB21 or MAPA.
When: Friday, June 27, 2 p.m. to 4 p.m.
Where: UAA Consortium Library, Room 307. Parking is free on UAA campus this week.
Available for download:
Analysis (pdf, 2.6MB)
Analysis model (.xlsx, 234KB)
Presentation - May 1, 2014 (pdf, 3.95MB) to the Resource Development Council
Presentation - June 25, 2014 (pdf, 3.45MB) to Commonwealth North
If you are planning on attending the workshop, please RSVP by calling (907) 786-7710 so we know how many to expect.
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Last year the Alaska Legislature made a controversial change in the oil production tax, the state’s largest source of oil revenue. The old tax, known as ACES (Alaska’s Clear and Equitable Share), was replaced with MAPA (More Alaska Production Act, or SB21). Critics and supporters of the change strongly disagree about which tax structure would benefit Alaska the most over time—and in August voters will decide whether they want to keep or repeal the new tax.