|Posted:||August 3, 2015 04:12 PM|
|From:||Representative Scott A. Petri|
|To:||All House members|
|Subject:||Marcellus Shale Tax Bill|
|In the near future, I will be introducing a Marcellus Shale Tax Bill. The rate of the tax is 5.0% on the market value of natural gas. This rate was selected based upon the cost of doing business in Pennsylvania (9.99% CNI) and the cost to drill in Pennsylvania. As you may know, Pennsylvania ranks above average in the cost to drill; only Michigan and Wyoming cost more. In 2012, natural gas companies and their affiliates paid a total of $303.1 million in taxes.
The projected revenue from a 5.0% severance tax is estimated at $1.2 billion by 2019-20, compared to the $853.5 million that the current impact fee has generated over the last four years. Projections estimate that total severance tax collections in 2015-16 would equal $148.2 million, with $40.67 million in net severance tax revenues. By 2019-20, total severance tax collections would equal $725.5 million, with $505.98 million in net severance tax revenues.
My legislation does not re-enact the impact fee but has language to hold harmless the funds currently being distributed by the impact fee. The advantages of a tax are:
Please join me in co-sponsoring this legislation.
Introduced as HB1536