Alaska group calls for hefty cruise head tax

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JUNEAU -- Days after Alaska's legislature passed a bill that gives the state the nation's toughest cruise ship waste-disposal law, a citizen group here called Cruise Control said it will launch a campaign for a state-wide $50 per-passenger "excise tax" and an unspecified "corporate income tax" on cruise lines.

Cruise industry lobbyists worked with the legislature to hammer out the new law and fought against attempts to use is as a vehicle for adding a cruise passenger head tax.

For Cruise Control, however, that battle is not over.

Alaskan cruise operators are facing another tax proposal.In an interview with Travel Weekly, the group's attorney Robert Reges said that while the new law, H.B. 260, is "overall, a good bill," Cruise Control will continue to pursue a new tax on cruise passengers, and they will begin collecting signatures this summer to get the proposal on the statewide ballot in November 2002.

"We're seeking to establish an excise tax that would apply statewide," said Reges. "We are a state that has no income tax. Our economy has allowed us to live off the taxation of industries like oil and gas. We don't see why other industries shouldn't pay their fair share, particularly an industry that makes its living off the resources of our state."

Booming cruise traffic in the 49th state has profoundly impacted the quality of life in many Alaskan port cities, said Reges, and cruise lines should help shoulder the cost. "Many communities feel their infrastructure is being taxed [by cruise-ship visits] and this would help to relieve that stress on our resources and services," Reges said.

A state-wide head tax, he added, would also take a powerful weapon away from cruise operators, who fend off tax proposals by individual ports by threatening to by-pass them.

"We know cruise lines aren't going to stop coming to Alaska," he said.

Reges said a per-passenger head tax would be set at $50, but he did not give a figure for the proposed "corporate tax," saying other Cruise Control officials were more familiar with the tax proposal specifics.

John Hansen, president of the North West CruiseShip Assn., which represents 16 cruise operators in Alaska, said, "This is a tax-generation matter that does not apply to cruise tourism. [Head taxes] add cost to the price of vacations in Alaska, and cruise ships bring more than half of the visitors to the state. I don't think it's a good message to send out to vacationers that cruises in Alaska are subject to these extra fees."

Hansen added that the cruise industry is an important economic engine for many Alaskan communities. "We are always available to discuss the industry's contributions to Alaska," he said.


But Reges said the "big question" is how much cruise lines actually contribute to local economies. "Because of the suppliers' vertical integration, it's not like the money spreads around," he said. "If a passenger gets off a ship and walks right onto a rail car owned by the cruise line, it's moving from one of the company's pockets to the other."

Reges added, "We do need the cruise lines and they have been good corporate citizens, but we're saying let's sit down and figure out all of the market and non-market costs and let's see if they are really paying their way. [Alaska] is going to have a very long relationship with cruising and we want it to be a symbiotic one and not a parasitic one."

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