Hilcorp sale will cost state $30 million annually in lost revenue, former tax officials say

Two former directors of Alaska’s tax division and a former state legislator say a gap in Alaska’s corporate income tax system could cost the state millions in lost revenue once a new multibillion-dollar deal between Hilcorp and BP is finalized.

The loss could be more than $30 million per year, said Ken Alper, director of the state’s tax division under former Gov. Bill Walker.

“This is a big deal,” Alper said.

Under Alaska’s existing corporate income tax system, publicly traded corporations are taxed. Privately held corporations are not. On Tuesday, Hilcorp — which calls itself the “largest privately owned oil and natural gas producer in the United States” — announced that it will buy the Alaska assets of BP, a publicly traded London-based company.

Dan Dickinson, tax division director under multiple governors before Alper, said of the four types of state levies on oil production — property taxes, production taxes, royalties and corporate income taxes — the income tax is the most likely to change significantly as a result of Tuesday’s announcement.

Read more: https://www.adn.com/business-economy/2019/08/29/former-tax-officials-say-hilcorp-sale-will-cost-state-30-million-annually-in-lost-revenue/
(Anchorage Daily News)