By Michael T. Altvater
The Ohio House Ways and Means Committee updated House Bill 375, which proposes changes to the severance tax on natural resources. Among the updates are an increase in the proposed severance tax to 2.25% from 2% for horizontal wells, a reduction in the period of time for the initial 1% tax rate from 5 years to 2 years, and an allocation of 10% of tax revenues to Eastern Ohio counties where drilling activity is concentrated. Under the proposal, operators of traditional vertical wells would not pay any severance tax for the first three years. Thereafter, the tax increases to .25% of gross receipts before falling to .1% after 20 years. A vote on updated House Bill 375 has not yet been scheduled.
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