Legislation signed in early July extends the sunset date for an Alaska tax credit program for seafood processors that bring value-added product to market.
The legislation, sponsored by Sen. Gary Stevens, R-Kodiak, continues the tax credit for salmon and herring value-added products until Jan. 1, 2027 and also allows tax credits for products from other Alaska fish species.
The program, the Alaska Salmon Product Development Tax Credit, is credited as a major reason for the boost in the commercial value of Alaska seafood since its inception in 2003.
Data compiled by the Alaska Seafood Marketing Institute and the Pacific Seafood Processors Association concludes that $114.4 million in new revenue has been generated from the program.
Stevens said that the new law extends the ability for Alaska seafood processors to receive cost recovery for installing new equipment and for making significant investments to get more value out of each fish.
“It also encourages entirely new products made from what would otherwise be fish waste and expands tax-credit opportunities to Pollock and cod products,” he said.
SB-33, which passed the Legislature on May 2 and was signed into law on July 7, addresses the concern for a potential loophole that a value-added tax credit could be applied to processing activity aboard vessels for product caught outside of state waters and processed, but not landed, inside state waters.
The amendment makes clear that tax credit applicability and investment incentives are being established only for Alaska shore-based, value-added processing of Pollock, Pacific cod and sablefish.
It holds harmless existing on-and-offshore value-added processing of salmon and herring as those programs have been in state statues since 2004, and have proven successful.
Stevens also sponsored the original legislation creating the tax credit. Herring was added to the program during a later reauthorization of the law.