Poll Question: Do You Support The Severance Tax ?

I posted this question to the members of USA, but I'd like to know how the GMS membership feels ?

I will send the results to the Governor, President of the Senate, Speaker of the House, and appropriate committees.

Answer this thread yes or no, or send me a PM.

Do You Support The Severance Tax ?

Thanks,  Mark

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Replies to This Discussion

Permalink Reply by ken on June 12, 2013 at 12:12am

NO

Permalink Reply by TUCO on June 12, 2013 at 12:57am

No, but please keep my vote private. Don't want IRS or NSA to know that I feel taxed enough already.

Permalink Reply by J Malone on June 12, 2013 at 1:19am

NO! Never! Taxed enough already! Government doesn't pay anything to maintain my property.  NO!

Permalink Reply by david lowry on June 12, 2013 at 4:44am

no

Permalink Reply by Joseph-Ohio on June 12, 2013 at 4:48am

What's the tally Mark ?

 

Permalink Reply by Joseph-Ohio on June 12, 2013 at 5:55am

Severance Tax.

We think:

If a new Severance tax is applied things that we think we could see happen are as follows:

1)  The O & G Companies would probably raise the cost of their product and leasehold acquisition money would shrink - both to cover their lost revenue.

2)  The government would probably grow in size to administer their new money and then spend it on themselves / their supporters.

3)  Shale Gas and Oil Development probably would slow down even more.

We think the new Severance tax (or any new tax for that matter) would be inflationary as well as landowner / consumer / general public PUNITIVE.

Tax revenue would automatically rise with accelerated / increased Shale Oil / Natural Gas Development / use.

We should not hamper Shale Oil / Natural Gas Development as we think it will improve our domestic economy and reduce our CO2 footprint being better for the environment.

Has anyone noticed all of the severe storms / changing weather patterns many attribute to the high CO2 footprint / global warming - we have.

Why should our politicians delay improvements to our domestic economy ?  Answer: They should not for any reason - they should rather do everything they can to improve it.

Why should our politicians take us to war for the sake of protecting the rest of the world's oil supply when we have enough energy / oil / natural gas to fulfill our uses without having to war ?  Answer: They should not - they should rather do everything they can to keep us out of the battlefield - unless we are deliberately attacked / provoked and in that case defend and prevail - as we are so blessed and empowered to do as a nation.

We / our leadership / our politicians shouldn't be stupid about these things - we / they should wise up.

Those are the reasons / concerns as to why we've Voted no earlier.

You can count this reply as Seven (7) NO Votes Mark, as I know I speak for my immediate and extended family.

Permalink Reply by James D Troyer on June 12, 2013 at 6:03am

No -No-No,   never agreed .... A Greed 

Permalink Reply by Joseph-Ohio on June 12, 2013 at 7:22am
Very optimistic of you Jesse.
Permalink Reply by Bluflame on June 12, 2013 at 7:32am

Jesse,

  It seems you and I are in a very small minority! I also see some merit to a tax that will be mostly borne by the O&G's if it offsets other taxes, particularly individual income taxes. Usage is key and it's probably naive to think politicians would not have their hand in the till.

BluFlame

Permalink Reply by Bluflame on June 12, 2013 at 12:19pm

Thanks Bob,

  Technically you are correct that the E&P's seek to pass along taxes to the consumers. In this case, market forces will determine their ability to do so. I'm guessing that many Utica landowners have leases that absolve them of severance tax deductions from royalties. It would be interesting to see a % statistic, but very difficult to nail down a number.

  I'm generally suspicious of any new taxes. At this point, an increased severance tax will not be part of the new budget (IMHO), thank you Ohio Oil & Gas Association. Gov Kasich states there could be a taxpayer referendum putting the severance tax on the ballot. That process is in its very early stages, and unlikely to raise its ugly head before next spring, at the earliest.

  As Utica landowners, we will not even register as a blip on the radar screen of a vote tally mandated by a voter referendum. I can only assume that taxpayers will be anxious to receive any income tax relief provided by the ballot measure, assuming it progresses to that point.

 Again, IMHO, there is lots of water to flow over the dam before this issue appears on a ballot. Could change significantly from its current form. Unfortunately, Utica landowners aren't driving the ship.

BluFlame.

  

Permalink Reply by Bluflame on June 12, 2013 at 3:39pm

Bob,  

  Despite the negative opinions voiced here, a severance tax increase is likely to occur at some point. Your second paragraph is a good testimony to why it will happen.

   Assuming its inevitability, I'd like to see it be revenue-neutral with a corresponding decrease to the state income tax. This COULD be a job-growth driver for the state, ala Texas.

   "When life deals you lemons, make lemonade".

BluFlame

   

Permalink Reply by Tony Yurina on June 12, 2013 at 4:28pm

Has Kasich's original plan dropped the severance taxes on many of the professional services outside oil & gas?  

If not, just wait until you have an Attorney or Dentist, Doctor bill handed to you, add the proposed 4.5% severance tax to their bill to the average Ohio citizen..... ie. a dentist bill for services performed to perform a root canal, say a customary fee is $500 + 4.5%, your bill has just increased to $522.50.    Engineering service for well completion +4.5% (cost increase) levy the severance tax to production revenue -4.5%.  Suddenly more of the marginal wells are not economic to produce/complete, from the outer core of the play.  For wells in the lucrative core play, the costs will be passed through to the end users.

Let's consider the farmer who is being force pooled (state controlled), his attorney fee is $10,000, add $450 for state severance tax !!  How fair is that?   It is a travesty if he was not awarded bonus money by the commission over seeing the mandatory pooling order.

And this my friends is not pretty.  Oh, after the Federal and State tax add Affordable Health Care tax to bonus and or royalty an additional negative - 3.8% also.  Oops, I forgot about the health care insurance premiums slated to increase due AHC.

I concede, some tax is needed to operate government, etc.  however, the recent proposals are not equitable to O&G companies nor land owners.

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