Alaska lawmaker proposes taxes on fish, boats in retaliation for Washington fuel export tax

Feb 22, 2022, 6:29 AM | Updated: 10:01 am

Fishing boats, fuel tax...

Fishing boats moored in Alaska. (Getty Images)

(Getty Images)

Is Washington on the brink of a trade war with Oregon, Idaho, and Alaska? All three states have expressed deep concern over a plan from Washington Democrats to impose a six cent per gallon tax on fuel refined along Puget Sound but shipped out of state.

Washington’s proposed gas export tax is ‘unacceptable,’ says Oregon governor

The proposed tax would be one of the funding sources for the $16 billion transportation package proposed by Democrats in the state Legislature, the rationale being that our state bears the environmental impact of the refining, and other states should share in that.

Not long after it was put on the table, Gov. Jay Inslee’s phone lit up with calls from the governors of those other states.

Oregon Governor Kate Brown called the plan “unacceptable.” Idaho Governor Brad Little labeled it unfair, asking Inslee to step in and remove the tax from the transportation budget proposal.

Meanwhile, Oregon and Idaho lawmakers have said they plan on retaliating with their own taxes to hit Washington consumers. That saw Idaho lawmakers in the state House release a joint statement on Tuesday, vowing to “take any all action necessary to block this new tax,” while urging Inslee to speak out against the levy and commit to vetoing it should it pass.

Alaska state Rep. Kevin McCabe has already drafted two proposed retaliatory measures as well.

“One which will be a 6 cent per pound tax over the landing tax on fish that are landed in Alaska,” he described. “The other one would be a 6 cent per foot tax on any boat that moors or anchors in Alaska harbors.”

Multi-billion dollar transportation package would strike down repeal of fuel export tax

That would apply to all Washington fishing vessels with home ports Ballard but fish in Alaska. If passed, McCabe’s proposals could send the cost of seafood in the state skyrocketing.

Speaking to the Anchorage Daily News, McCabe expressed his belief that Washington’s proposed export tax would be a clear violation of the federal commerce clause, which prevents states from taxing items exported between them.

“I mean, anybody that has read a little bit of the Constitution understands that, but apparently the Washington lawmakers don’t,” he said. “Frankly I’m tired of being thought of as a Washington colony, and I’m tired of them depending on us and taxing us for their needs and ignoring ours.”

Texas does have an export tax, but analysts I have been talking to say it’s not drawn up the same way, which leaves Washington’s proposal in uncharted territory. Tennessee also levies a tax on all petroleum products it exports to other states, but at a much lower rate of one-twentieth of one cent per gallon.

As for how potential retaliation from other states might affect Washington’s proposed transportation package, KIRO Newsradio reporter Hanna Scott says Democrats in the Legislature don’t appear to be backing down on the export tax for the time being.

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Alaska lawmaker proposes taxes on fish, boats in retaliation for Washington fuel export tax