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Fracking and Alternative Energy

Babst Calland: Drilling Severance Tax Bill Proposed In The Pennsylvania House

By Elena L. Rorabaugh

A bill that would amend taxation on oil and gas drilling was referred to the Pennsylvania House Committee on Environmental Resources and Energy on Monday. House Bill 2508, which was introduced by Margo Davidson (Democrat, Delaware County) and others, seeks to impose a severance tax of 5% of the gross value of units severed at the wellhead during a reporting period, plus 5 cents per unit severed. Filing of a tax return would be required within 15 days following the end of a reporting period. Oil and gas producers would also be required under the Bill to apply to the Department of Revenue for a severance tax registration certificate prior to conducting operations, which must include, among other items, a declaration of all producing sites and nonproducing sites used by the producer for severance of natural gas. The Department may refuse to issue or revoke a registration certificate, and the Bill provides a process for appealing such determination. The violation of such provisions under the Bill would result in a producer being found guilty of a summary offense and sentenced to pay a fine. The Bill includes additional provisions regarding assessments, interest, and penalties.  The Bill in its entirety can be found here.

Copyright 2014 • Babst, Calland, Clements and Zomnir, P.C. • Two Gateway Center, Pittsburgh, PA 15222 • 412-394-5400 • Administrative Watch is privately distributed by Babst, Calland, Clements and Zomnir, P.C., for the general information of its clients, friends and readers. It is not designed to be, nor should it be considered or used as, the sole source of analyzing and resolving legal problems. If you have, or think you may have, a legal problem or issue relating to any of the matters discussed in the Administrative Watch, consult legal counsel.

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