Gov. Wolf has proposed a severance tax on the extraction of natural gas in Pennsylvania to provide funding for public schools. Lawmakers in both parties have introduced severance tax bills every year since 2009, and every year the gas drillers have successfully fought the tax, spending $46.8 million on lobbying since 2007. Much of the industry’s lobbying money has gone into manufacturing a narrative, built on a foundation of myths, about the economic benefits of drilling and the fragility of the industry.
Gov. Wolf has proposed a severance tax on the extraction of natural gas in Pennsylvania to provide funding for public schools. Lawmakers in both parties have introduced severance tax bills every year since 2009, and every year the gas drillers have successfully fought the tax, spending $46.8 million on lobbying since 2007. Much of the industry’s lobbying money has gone into manufacturing a narrative, built on a foundation of myths, about the economic benefits of drilling and the fragility of the industry.
The Pennsylvania Budget and Policy Center has compiled five facts, supported by research and independent data, which tell the real story. We are posting a fact a day on this blog. Today, we give you:
Fact 4. Pennsylvania’s proposed severance tax has an effective rate that is lower than or equal to that of other major gas-producing states. When gas prices are at $2.50 per 1,000 cubic feet of natural gas (McF) or more — and the Energy Information Agency projects gas will average $3.05 per McF in 2015 – Pennsylvania’s tax would have a lower effective rate than in Wyoming and New Mexico, and would be roughly equal to the rate in Texas. As natural gas prices rise, the effective rate would drop.