It helps to power the electrical grid; it's lowering costs in the manufacturing and petrochemical industries; and it's a key ingredient in the production of hundreds ...
THE FACTS ON A STATE-WIDE SEVERANCE TAX Thanks to shale energy development, jobs are being created throughout the state. Natural gas production is growing our economy. It’s also providing much-needed revenue for local governments. If Harrisburg increases the cost of Pennsylvania natural gas production, working families and small businesses could ultimately pay the price. An energy production tax or severance tax could threaten the 339,000 jobs and the billions in revenue that Pennsylvania energy production provides our state. Any new tax could make Pennsylvania less attractive to further investment and place us at a competitive disadvantage to other shale plays, especially in those states with a lower Corporate Net Income Tax.
PENNSYLVANIA ENERGY PRODUCTION TAX: BAD FOR JOBS, BAD FOR THE ECONOMY, BAD FOR YOU
Even though Pennsylvania natural gas companies already pay sizeable local impact taxes and the highest corporate taxes of any major energy-producing state, some Harrisburg politicians want to impose another tax that could put thousands of Pennsylvania jobs in jeopardy, risk future investment, and undermine our state’s economy. Here are some of the reasons why a new tax on in-state oil and natural gas production is wrong for Pennsylvania:
Pennsylvania Already Taxes Energy Development
• Pennsylvania oil and natural gas companies paid almost $224 million in local impact taxes
just last year. Unlike the severance tax proposal, a majority of local impact taxes go directly to cities and counties across Pennsylvania and are spent on projects that matter to those communities. Local impact taxes have helped eliminate municipal debt, have paid for road construction and bridge repairs, and are keeping taxes low in Pennsylvania townships.
• Pennsylvania oil and natural gas companies pay the highest corporate tax rates of any energy-producing state.
• Pennsylvania’s existing taxes on energy include the highest gas taxes in the nation. In fact,
the cost of each gallon of gasoline sold in Pennsylvania includes close to 70 cents in fees and taxes imposed by state and federal government.
Higher Energy Taxes Could Mean Higher Costs for Consumers
• Higher natural gas taxes could raise the cost of energy production. • Natural gas produced in Pennsylvania doesn’t just heat our homes; it fuels our state
economy too. It helps to power the electrical grid; it’s lowering costs in the manufacturing and petrochemical industries; and it’s a key ingredient in the production of hundreds of household items—laundry detergent, insect repellent, plastic packaging that keeps our food safe, fertilizer to grow crops, ballpoint pens, and aspirin to name a few.
• Natural gas taxes can influence the prices Pennsylvanians pay to heat their homes, feed their families, manufacture goods, and purchase a number of household items.
Taxing In-State Energy Production Could Discourage Pennsylvania Energy Development
• As one of America’s top energy producing states, Pennsylvania tax policies should
encourage, not discourage, responsible in-state energy production. We have a part to play in America’s quest for energy security.
Adding an American Energy Production Tax On Top of Existing Taxes Will Hurt Pennsylvania’s Economy
• The oil and gas industry supports 339,000 jobs in Pennsylvania, 28,229 of which directly depend on oil and gas.
• Because a new tax could result in a decline in in-state energy production, state revenues could drop and jobs could be lost.
Adding yet another tax on American energy is the wrong thing for Governor Wolf to be doing. Pennsylvania’s oil and natural gas industry—and the 339,000 Pennsylvanians whose jobs are supported by the oil and natural gas industry—contributes millions of dollars in revenue across Pennsylvania that supports our schools, repairs our roads, and helps keep tax rates manageable for working families. Heaping a brand new tax onto just the natural gas that’s produced here in Pennsylvania could jeopardize billions of dollars in economic activity and put thousands of Pennsylvania jobs at risk. Let’s keep energy jobs here in Pennsylvania and not export them to other states.
