Need assist re: Severance tax in Ohio and in West Virginia

I live in Pennsylvania.  We have no severance tax here; only an impact fee.  However, the Wolf is at the door and I'm reaching out for help in an effort to learn how the severance tax might operate here if it comes here:

In Ohio and in West Virginia, do you already have a severance tax?  If so, please say whether you, as landowner and Lessor, end up having to pay any proportion of that tax into your state coffers.  If you do pay, is the tax deducted from your monthly royalty payment, or do you pay your state directly, on your own?  Or does the gas company pay the entirety of the severance tax?

On background, for folks living outside PA:  Tom Wolf is a gubernatorial candidate here.  He is promising, if elected in November, to work hard to impose a severance tax on us Pennsylvanians.

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Permalink Reply by Nancy Mosley on June 24, 2014 at 12:58am
None paid by royalty owners in WV. We pay property tax to the county and of course income tax to the state but no severance. I believe Ohio does have severance tax.
Permalink Reply by DEBORAH L. SCHWEIZER on June 24, 2014 at 5:58am

I pay a severance tax and I'm in Ohio Co, WV. Every owner I know does. If you don't then you will have to pay it out of pocket when the state catches up to you. We pay 5% of gross value for natural gas, 5% of gross value for oil, additional tax for worker's Compensation debit reduction at the rate of 0,047/net of natural gas produced.

Permalink Reply by Nancy Mosley on June 24, 2014 at 8:08am
Thanks Deborah for that info. My minerals are in Ritchie. I wonder if it is by county or by lease? All our production is on old leases so far. I better find out.
Permalink Reply by Alan Bowers on June 24, 2014 at 11:43am

Ohio does have a Severance Tax and it is not just on Oil and Gas.  If you do a search for Severance Tax Ohio Revised Code it will bring up the section in the Ohio Revised Code that deals specifically with Severance Tax and will give you a breakdown as well.

With respect to "Who Pays The Severance Tax" it depends on what is spelled out in your Oil & Gas Lease.  For example, the ALOV leases that landowners in Ohio signed with Chesapeake back in 2011 state that Chesapeake is responsible for 100% of the Severance Tax on Oil, Gas, and NGL's removed from the ground.  The ALOV leases that landowners in Ohio signed with BP in 2012 have an 82.5% - 17.5% split with the Oil Company paying 82.5% of the Severance Tax due and the Landowner responsible for 17.5%.

Other Oil and Gas Leases may have a different split on the responsibility of paying the Severance Tax. 

Permalink Reply by Alan Bowers on June 24, 2014 at 11:51am

Whether or not the Oil company withholds the Severance Tax from the monthly Royalty Payment is something you should refer back to your Lease.  If there is nothing specifically in the Lease about Severance Tax then you should look through the Lease to see what they are allowed to withhold. 

Permalink Reply by Frank Walker on June 25, 2014 at 2:17am

Just wanted to thank everyone who responded;  thank you so much.

I have some problems forthcoming if PA gets a severance tax, I can tell you that.  I pretty much messed up my lease where such ad valorem taxes are concerned.  Badly need a "do over".  Doubt I'll get one.

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