State Severance Taxes

Severance taxes are excise taxes on natural resources "severed" from the earth. They are measured by the quantity or value of the resource removed or produced. In the majority of states, the taxes are applied to specific industries such as coal or iron mining and natural gas or oil production. They are usually payable by the severer or producer, although in a few states payment is made by the first purchaser. The taxes usually are imposed at a flat rate per unit of measure, with coal and ore mining taxes levied on a tonnage basis, oil production taxes on a per barrel basis, and gas production taxes on a per foot basis, although the rates may be graduated based on volume of production or value of the products. "Value" may mean market value in some states and gross value in others. Taxable net value or net proceeds are determined by deducting certain items from the gross value or gross proceeds. Examples of deductions include production costs, ad valorem taxes and royalties paid. Evaporation for gas wells also might qualify as a deduction.

As the following map demonstrates, severance taxes accounted for a small part of overall tax collections in most states.

2011 SEVERANCE TAXES AS A PERCENTAGE OF TOTAL TAX COLLECTIONS
 

 

 

Severance taxes accounted for over 20% of total state taxes collected

 

 

 

Severance taxes accounted for 15-20% of total state taxes collected

 

 

 

Severance taxes accounted for 10-15% of total state taxes collected

 

 

 

Severance taxes accounted for 5-10% of total state taxes collected

 

 

 

Severance taxes accounted for 0-5% of total state taxes collected

 

Source: NCSL calculations based on data from the Bureau of the Census


A variety of taxes appear under the general heading of severance taxes, as the following list from the Commerce Clearing House State Tax Guide demonstrates for the 39 states that collect severance taxes.
AL | AK | AZ | AR | CA | CO | FL | ID | IL | IN | KS | KY | LA | ME | MD | MI | MN | MS | MO | MT | NE | NV | NH | NM | NC | ND | OH | OK | OR | SC | SD | TN | TX | UT | VA | WA | WV | WI | WY

 State

 Title and Application of Tax

 Information and Rates

 Alabama

 Severance Tax

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 Mineral documentary tax

 Iron ore—3¢ per ton mined. Coal severance—13.5¢ per ton (expired 10/1/2011). Coal and lignite severance additional privilege tax——20¢ per ton.

 Oil and gas—8% 1 , 2 (plus 2% conservation tax) of gross value at point of production of oil or gas; 4% 2  for 
 incremental oil or gas production resulting from a qualified enhanced recovery project; 4% 2  for wells 
 producing 25 barrels or less of oil per day or producing 200,000 cubic feet or less of gas per day; 6% 1 , 2 for 
 oil or gas produced offshore at depths greater than 8,000 feet below mean sea level; and 6% 2 (for a 5-year
 period) for oil and gas produced from onshore discovery wells, from onshore development wells on which
 drilling began within 4 years of the completion date of the discovery well and producing from a depth of 6,000
 feet or more, and onshore development wells on which drilling began within 2 years of the completion date of
 the discovery well and producing from a depth less than 6,000 feet.

 Offshore oil and gas production from depths greater than 8,000 feet below mean sea level—3.65% of gross 
 proceeds.

 Statewide severance tax equal to 10¢ per ton on certain severed products imposed by certain counties. 
 Some counties impose a higher rate.

 Forest products—pine lumber, 50¢ per 1,000 feet board measure, 75¢ per 1,000 feet log scale, or 10¢ per
 ton; hardwood and others, 30¢ per 1,000 feet board measure, 50¢ per 1,000 feet log scale, or 6.5¢ per ton;
 pulpwood and others, 25¢ per standard cord or 10¢ per ton; pulpwood chips, 25¢ per 190 cubic feet or 10¢
 per ton; crossties, 1.5¢ per piece or 15¢ per ton; switch ties, 2.5¢ per piece or 17¢ per ton; turpentine, 15¢
 per barrel; mine ties and coal mine props, 12.5¢ per 100 pieces or 15¢ per ton; piling and poles, $1.875 per 
 1,000 board feet or 20.5¢ per ton; pine ore mine props, 75¢ per 1,000 feet log scale; or hardwood ore mine 
 props, 50¢ per 1,000 feet log scale. Additional privilege tax on processors and manufacturers using
 timber—50% of the severance tax.

 Mineral documentary—Lease of 10 yrs. or less, 5¢ per acre; 11 to 20 yrs., 10¢; more than 20 yrs., 15¢.

 Alaska

 Mining license tax
 
 
 
 
 Oil and gas property taxes

 
 
 Oil and gas production tax
 
 
 
 
 
 Fisheries Business Tax
 
 
 
 Fishery Resource Landing Tax
 
 




 Seafood Marketing Assessment
 
 Salmon Enhancement Tax
 
 
 
 Regional Seafood Development Tax
 



 Dive Fishery Management Assessment

 Net income of taxpayer reported to federal government and royalties from Alaska mining property at
 following rates: Over $40,000 to $50,000, $1,200 plus 3% of the excess over $40,000, $50,001 to
 $100,000, $1,500 plus 5% of excess over $50,000; $100,001 or over, $4,000 plus 7% of excess over
 $100,000.
 
 Property used or committed for use in exploration, production, and pipeline transportation of unrefined oil or
 gas, 20 mills of full and true value. Municipal taxes may be levied on such property.
 
 25% of the annual "production tax value" of oil and gas. When a producer's average monthly production tax
 value per BTU equivalent barrel of taxable oil and gas is between $30 and $92.50, an additional tax of 0.4% 
 is imposed on the difference between the average monthly production tax value and $30. When a producer's 
 average monthly production tax value exceeds $92.50, the additional tax is 0.1% of the difference between
 the monthly production tax value and $92.50. Tax may not exceed 75%.
 
 Levied on persons who process or export fisheries resources from Alaska. The tax is based on the price paid
 to commercial fishers or fair market value when there is not an arms length transaction. Fisheries business tax
 is collected primarily from licensed processors and persons who export fish from Alaska.
 
 Levied on fishery resources processed outside the 3-mile limit and first landed in Alaska or any processed
 fishery resource subject to sec. 210(f) of the American Fisheries Act. The tax is based on the unprocessed 
 value of the resource, which is determined by multiplying a statewide average price (determined by
 the Alaska Department of Fish and Game data) by the unprocessed weight. The Fishery Resource Landing
 Tax is collected primarily from factory trawlers and floating processors which process fishery resources
 outside of the state's 3-mile limit and bring their products into Alaska for transshipment.
 
 Levied at a rate of 0.5% of the value of seafood products processed first landed in, or exported from Alaska.
 
 Levied on salmon caught or sold in an established aquaculture region. This tax is collected by licensed
 processors and is based on the price paid for the salmon. Fishers that sell to unlicensed buyers or that export
 from an established aquaculture region must pay the tax directly to the department.
 
 Levied on salmon harvested by set gillnet fishers in Prince William Sound (PWS) and drift gillnet fishers in
 Bristol Bay and PWS. The 1% tax is collected by licensed buyers and is based on the price paid for the
 salmon. Fisherman who sell to unlicensed buyers or who export from Alaska must pay the tax directly to the
 department.
 
 Levied on geoducks, sea urchins, and sea cucumbers harvested in the Southeast dive region.  The tax is
 collected by licensed buyers and is based on the price paid for the resource. Dive fishers that sell to
 unlicensed buyers in or export from Alaska must pay the tax directly to the department.

 Arizona

 Severance tax

 Mining—2.5% of net severance base or, if less, of the gross value of production minus production costs.

 Arkansas

 Severance or production tax; oil and gas 
 conservation tax

 Severance—barite, bauxite, titanium ore, manganese and manganiferous ores, zinc ore, and cinnabar: 15¢
 per ton; coal, lignite and iron ore: 2¢ per ton (8¢ per ton additional tax on coal); lead ore: the greater of 15¢
 per ton or 10% of market value.

 Producers of the sand and gravel are taxed at the rate of $0.04 per ton of 2,000 lbs.

 Natural gas: 0.3¢ per 1,000 cubic feet produced; effective January 1, 2009: on new-discovery gas, 1.5% of
 the market value of the natural gas, applicable to the first 24 consecutive calendar months beginning on the
 date of first production, regardless of whether production commenced prior to January 1, 2009; provided,
 however, that all production attributable to the period prior to January 1, 2009, will be taxed at the rate in
 effect prior to January 1, 2009; on high-cost gas, 1.5% of the market value of the gas, applicable to the first
 36 consecutive calendar months beginning on the date of first production, regardless of whether production
 commenced prior to January 1, 2009; provided, however, that all production attributable to the period prior
 to January 1, 2009, will be taxed at the rate in effect prior to January 1, 2009; on marginal gas, 1.25% of
 the market value of the gas; on all natural gas that is not defined as "new discovery gas," "high-cost gas," or
 "marginal gas," 5%.

 Oil: 5% of market value at time and point of severance (plus additional 25 mills per barrel and additional 2¢
 per barrel) for wells producing more than 10 barrels per day; 4% for wells producing 10 or fewer barrels per
 day (plus an additional 25 mills per barrel and an additional 2¢ per barrel);

 Timber: pine, 17¢ per ton; all other, 12.5¢ per ton;

 Others: 5% of market value at time and point of severance.

 California

 Severance (oil and gas) tax


 Timber Yield tax

 For 2011-2012 fiscal year, $0.1266251 per barrel of oil produced or per 10,000 cubic feet of natural gas
 produced (rate determined annually based upon estimate of annual conservation costs).
 
 The timber yield tax applies to the harvest of forest trees, whether standing or down, for wood products. 
 The timber yield tax is based on values established by the state for various timber products, as determined
 by analysis of market transactions in different areas.

 Colorado

 Severance tax
 
 
 
 
 
 Coal severance tax
 
 
 
Oil and gas conservation
tax

 Metallic minerals—2.25% of income over $19 million. Molybdenum ore—first 625,000 tons produced by an
 individual in each quarter of a taxable year are not taxed, 5¢ per ton thereafter. Oil and gas—under $25,000
 of gross income, 2%; $25,000 to $100,000: $500 plus 3% of excess over $24,999; $100,000 to $300,000:
 $2,750 plus 4% of excess over $99,999; $300,000 and over, $10,750 plus 5% of excess over $299,999. Oil
 shale—4% of gross proceeds in excess of the greater of 15,000 tons per day or 10,000 barrels per day.
 
 36¢ per ton after first 300,000 tons produced each quarter (adjusted quarterly to changes in producers' price
 index, currently, 85¢). 50% credit for coal from underground mines; additional 50% credit for production of
 lignitic coal.
 
 Not to exceed 1.7 mills on each dollar of the market value at the well plus a surcharge of not to exceed 0.2
 mill per dollar of market value at the well.

 Florida

 Oil, gas and sulfur production taxes





 Solid minerals tax

 Production—Oil, for tertiary oil, a tiered rate structure based on the sale price or market price of a barrel of
 oil is in effect as follows: 1% of the gross value of oil on the value of oil $60 and below; 7% of the gross
 value of oil on the value of oil above $60 and below $80; 9% of the gross value of oil on the value of oil $80
 and above); escaped oil, 12.5% additional. Gas, for 2011-2012, 34.5¢ per MCF (rate set annually, based on
 gas fuels producer price index). Sulfur, for 2011-2012, $5.69 per ton).
 
 Solid minerals—8% of value of mineral severed. Heavy minerals—$3.20 per ton for 2011 (rate adjusted 
 annually by the change in the producer price index). Lake belt area limerock and sand — the per-ton
 mitigation fee will be 25.2¢. Phosphate rock —for July 1, 2011, to June 30, 2012, the tax rate is $1.61.
 Water treatment plant upgrade fee, 15¢ per ton of limerock and sand extracted.

 Idaho

 Severance taxes

 Mine license tax—1% of net value of royalties received or ores mined.
 
 Oil and gas production tax—maximum 5 mills per barrel of oil or per 50,000 cubic feet of gas.
 
 Additional oil and gas production tax—2% of market value of oil or gas produced at site of production.

 Illinois

 Timber Harvest Fee

 Under the Timber Buyers Licensing Act (225 ILCS 732/2), when timber or logs are sold the timber buyer shall
 determine the amount to be paid for such timber, or the value of items to be bartered for such timber, and
 shall deduct from the payment to the timber grower an amount which equals 4% of the purchase price. The
 timber buyer shall forward such amount to the Department of Natural Resources, along with a report of the
 purchase on forms provided by the Department. The 4% monies are deposited in the Forestry Development
 Fund.

 Indiana

 Severance tax

 The tax rate is equal to the greater of 1% of the value of the petroleum or 3¢ per 1,000 cubic feet of natural
 gas and 24¢ per barrel of oil.

 Kansas

 Severance tax
 
 Conservation fee fund tax
 

 Oil and gas, 8% of gross value; coal, $1 per ton.
 
 Oil and gas-rates set by State Corporation Commission: Oil, 91 mills per barrel; Gas, 12.90 mills per 1,000
 cubic feet; Plugged well, 3.25¢ per foot of well depth ($35 minimum).

 Kentucky

 Oil production
 
 Severance taxes

 Oil production—4.5% of market value of crude petroleum produced.
 
 Coal severance—4.5% of gross value of coal severed and/or processed. Minimum tax, 50¢ per ton of
 severed coal. Tax limited to 50¢ per ton or 4% of the selling price per ton, whichever is less, on coal used for
 burning solid waste.
 
 Natural resources severance—4.5% of gross value of natural gas and other natural resources severed or
 processed. Tax limited to 12¢ per ton of clay and 14¢ per ton of limestone used to manufacture cement.

 Louisiana

 Severance tax
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 Freshwater mussels tax

 Minerals—Sulphur, $1.03 per long ton of 2,240 lbs.; Salt, 6¢ per ton of 2,000 lbs.; Marble, 20¢ per ton of
 2,000 lbs.; Stone, 3¢ per ton of 2,000 lbs.; Sand, 6¢ per ton of 2,000 lbs.; Shells, 6¢ per ton of 2,000 lbs.;
 Salt content in brine, when used in the manufacture of other products and not marketed as salt, 0.5¢ per ton
 of 2,000 lbs.; Lignite, 12¢ per ton of 2,000 lbs. An annual regulatory fee of 8¢ per ton is imposed on all coal
 and lignite mined in Louisiana.

 Timber—Trees and timber, 2.25% of current stumpage value as determined by the Louisiana Forestry
 Commission. Pulpwood, 5% of current stumpage value as determined by the Louisiana Forestry Commission.
 
 Gas—The tax rate for natural gas and equivalent gas volumes of natural gasoline, casinghead gasoline, and
 other natural gas liquids per 1,000 cu. ft. at a base pressure of 15.025 lbs. per sq. in. absolute and at 60
 degrees Fahrenheit is adjusted annually on July 1 and may never be less than 7¢. Full rate, 16.4¢ per
 thousand cu. ft., effective July 1, 2010, to June 30, 2011 (33.1¢ per thousand cu. ft. prior to June 1, 2010).
 Incapable oil–well gas, 3¢ per thousand cu. ft. Incapable gas–well gas, 1.3¢ per thousand cu. ft.
 
 Oil—(per barrel of 42 gals.)—Full rate oil/condensate, 12.5% of value. Incapable oil rate, 6.25% of value.
 Stripper oil rate, 3.125% of value (stripper oil is exempt as long as the average posted price for a 30-day
 period is less than $20 per barrel). Reclaimed oil, 3.125% of value.
 
 Oilfield site restoration fees—Fee per barrel on crude oil and condensate is 1.5¢ for full-rate wells. The
 fee per thousand cu. ft. on full-rate natural gas and casing head gas production is 0.3¢. The fee for reduced
 rate oil and gas production such as stripper wells and incapable wells is the same proportion to the oil or gas 
 full rate production fees as the reduced rate severance tax is to the full rate severance tax.
 
 A tax is levied of five percent of the revenues derived from the sale of all whole freshwater mussels taken
 from the waters of this state.

 Maine

 Mining excise tax
 

 The tax on each mine site is the greater of (1) the value of facilities and equipment multiplied by 0.005; or (2)
 the gross proceeds multiplied by the greater of (a) 0.009 or (b) a number determined by subtracting from 
 0.045 the quotient obtained by dividing gross proceeds by net proceeds multiplied by 100. If net proceeds
 are equal to less than zero, tax on gross proceeds is determined by multiplying gross proceeds by 0.009.

 Maryland

 Mine reclamation surcharge
 
 Clam and Oyster Severance Tax

 A 15 cent mine reclamation surcharge for each ton of coal removed by the open-pit or strip method
 
 A severance tax of 50 cents per bushel shall be levied on all soft-shell clams of all species Mya arenaria
 caught within the State.

 Michigan

 Low-grade iron ore properties tax
 
 
 
 
 Forest lands tax
 
 
 
 Oil and gas severance tax

 0.55% of mine value per ton based on projected natural iron analysis of pellets or concentrated and/or
 agglomerated products prior to production times percent of construction completion; thereafter, 1.1% of
 mine value per ton based on average natural iron analysis of shipments for that year of pellets and
 concentrated and/or agglomerated products times average annual production of preceding five years.
 
 Forest lands—private reserves stumpage tax—5%. Commercial forests—annual specific tax of $1.20 per
 acre through Dec. 31, 2011; the tax is increased by 5 cents per acre, beginning Jan. 1, 2012, and every five
 years after that date.
 
 Severance—5% of gross cash market value of gas or 6.6% of gross cash market value of oil (4% of gross
 cash market value of stripper well crude oil and crude oil from marginal properties), plus a fee (computed
 annually) not to exceed 1% of the gross cash market value of all oil and gas produced in the state.

 Minnesota

 Severance taxes

 Mining occupation tax—applies to both ferrous and nonferous metals. The tax is paid in lieu of corporate
 franchise tax and is based on taxable income and imposed at the same rates as income tax.

 Taconite, iron sulphides, and agglomerate taxes—the preceding year's tax rate (2010, $2.380 per taxable
 ton) plus an amount equal to the preceding year's tax rate multiplied by the percentage increase in the implicit
 price deflator from the fourth quarter of the second preceding year to the fourth quarter of the preceding
 year. Additional tax of 3¢ per gross ton of merchantable iron ore concentrate for each 1% that the iron
 content of the product exceeds 72% when dried at 212 degrees Fahrenheit. Direct reduced ore—different
 rate, lower yearly payments with 6-year phase-in.

 Net proceeds tax (applies to all mineral and energy resources except sand, silica sand, gravel, building stone,
 all clays, crushed rock, limestone, granite, dimension stone, horticultural peat, soil, iron ore and taconite) —
 additional 2% of net proceeds from mining.

 Mississippi

 Gas and oil severance taxes
 
 
 
 



 Salt severance tax
 
 Timber or timber products tax
 
 
 
 
 
 
 
 
 
 
 
 
 
 






  Mineral documentary tax

 Gas—6% of value of natural gas produced and severed from soil or water, for sale, transport, storage,
 profit, or commercial use.
 
 Oil—6% of value at the point of production, 3% if oil is produced by an enhanced oil recovery method in
 which carbon dioxide or other approved method is used. Additional 14% of gross value of escaped oil.
 
 Additional maintenance charge—not to exceed 60 mills per barrel of oil or 6 mills on each 1,000 cu. ft. of gas.
 
 3% of the value of the entire production of salt in the state.
 
 Pine and soft woods used in manufacture of lumber and other products—$1 per 1,000 board feet (or 12¢ per
 ton).
 
 Hardwoods—75¢ per 1,000 board feet.
 
 Lumber, including crossties—75¢ per 1,000 feet actual board measure.
 
 Poles, piling, posts, staunchions, and other products not manufactured into lumber—$3.60 per 100 cubic
 feet.
 
 For other timber products bought by the cubic foot—55¢ per 100 cubic feet for pine and other soft woods;
 41¢ per 100 cubic feet for hardwoods.
 Pulpwood, except pine—22.5¢ per standard cord of 128 cubic feet; pine—30¢ per standard cord of 128 cubic
 feet.

 Stumpwood, lightwood, or distillate—25¢ per ton of 2,000 lbs.

 Turpentine crude gum—30¢ per barrel of 400 lbs.

 All others—75¢ per 1,000 board feet, or 37.5¢ per standard cord of 128 cubic feet.

 3¢ per mineral or royalty acre covered by conveyances or reservations of leasehold interests in nonproducing
 oil, gas, or other minerals for interests expiring 10 years or less from date of execution of instrument; 6¢ for
 terms between 10 and 20 years; 8¢ for terms exceeding 20 years. Minimum tax, $1.

 Missouri

 Assessment on surface coal mining
 permitees
 
 
 
  Forest crop land tax

 The application fee is $100, plus $100 per permitted acre. A full cost reclamation bond must be posted,
 meaning that an assessment of real reclamation costs will be jointly calculated and bodning set at the
 negotiated level of liability. In addition, there is an annual permit fee of $100 and a $100 permit renewal fee
 every five years.

 Yield tax—6% of value of material cut

 Montana

 Oil and natural gas production tax
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 



 Oil and gas conservation tax
 
 
 Coal severance tax
 
 
 
 
 
 Cement tax
 
 Metalliferous mines tax
 
 
 Micaceous minerals tax
 
 Mineral mining tax (resource indemnity
 and ground water assessment tax)
 
 
 
 
 

 Bentonite production tax

 Natural gas and oil are taxed on the gross taxable value of production on the basis of type of well and type
 of production according to the following schedule for working and nonworking interest owners (the rates do
 not include the oil and gas privilege and license tax rate imposed on the market value of oil or natural gas
 produced).

 Natural Gas—(a)(i) first 12 months of qualifying production, working interest 0.50%, nonworking interest
 14.8%, (ii) after 12 months (A) pre-1999 wells, working and nonworking interest 14.8%, (B) post-1999 wells,
 working interest 9%, nonworking interest 14.8%; (b) stripper natural gas pre-1999 wells, working interest
 11%, nonworking interest 14.8%; (c) horizontally completed well production (i) first 18 months of qualifying
 production, working interest 0.5%, nonworking interest 14.8%, (ii) after 18 months, working interest 9%,
 nonworking interest 14.8%.
 
 Oil—(a) primary recovery production (i) first 12 months of qualifying production, working interest 0.5%,
 nonworking interest 14.8%, (ii) after 12 months (A) pre-1999 wells, working interest 12.5%, nonworking
 interest 14.8%, (B) post-1999 wells, working interest 9%, nonworking interest 14.8%; (b) stripper oil
 production (i) first 1 through 10 barrels a day production, working interest 5.5%, nonworking interest 14.8%,
 (ii) more than 10 barrels a day production, working interest 9%, nonworking interest 14.8%; (iii) stripper well
 exemption production, working interest 0.5%, nonworking interest 14.8%; (iv) bonus production, working
 interest 6%, nonworking interest 14.8%; (c) horizontally completed well production (i) first 18 months of
 qualifying production, working interest 0.5%, nonworking interest 14.8%, (ii) after 18 months (A) pre-1999
 wells, working interest 12.5%, nonworking interest 14.8%, (B) post-1999 wells, working interest 9%,
 nonworking interest 14.8%; (d) incremental production (i) new or expanded secondary recovery production,
 working interest 8.5%, nonworking interest 14.8%, (ii) new or expanded tertiary production, working
 interest 5.8%, nonworking interest 14.8%; (e) horizontally recompleted wells (i) first 18 months, working
 interest 5.5%, nonworking interest 14.8%, (ii) after 18 months (A) pre-1999 wells, working interest 12.5%,
 nonworking interest 14.8%, (B) post-1999 wells, working interest 9% nonworking interest 14.8%.
 
 0.9/10 of 1% of market value of each barrel of crude petroleum or each 10,000 cubic feet of natural gas
 produced, saved and marketed or stored in Montana or exported.
 
 Surface mining—10% of value for coal having a BTU rating per lb. of under 7,000 and 15% of value for coal
 having a BTU rating per lb. of 7,000 and over.
 
 Underground mining—rates are 3% of value on coal having a BTU rating per lb. of under 7,000 and 4% of
 value on coal having a BTU rating per lb. of 7,000 and over.
 
 22¢ per ton of cement and 5¢ per ton of gypsum products.
 
 For concentrate shipped to a smelter, mill or reduction work, 1.81% if the gross value of the product is over
 $250,000. For gold, silver or platinum shipped to a refinery, 1.6% over $250,000.
 
 5¢ per ton of vermiculite, perlite, kerrite, maconite or hydrous silicates produced.
 
 Mineral mining tax—$25 plus 0.5% of gross value of products extracted from Montana if production exceeds
 $5,000, except as noted below. $25 plus 4% of gross value of product in excess of $625 for talc extracted
 from Montana and $25 plus 0.4% of gross value of product in excess of $6,250 for coal extracted from
 Montana. $25 plus 2% of gross value of product in excess of $1,250 for vermiculite extracted from Montana.
 $25 plus 10% of the gross value of product in excess of $250 for limestone extracted from Montana. $25 per
 year plus 1% of the gross value of product in excess of $2,500 for industrial garnets and associated
 by-products extracted from Montana.
 
 First 20,000 tons, exempt. 20,001 to 100,000 tons, $1.56 per ton. 100,001 to 250,000 tons, $1.50 per ton.
 250,001 to 500,000 tons, $1.40 per ton. 500,001 to 1,000,000 tons, $1.25 per ton. 1,000,001 tons and
 more, $1.00 per ton. Royalties, 15% of the amount paid or apportioned in kind to the royalty owner.

 Nebraska

 Oil and gas severance tax
 
 
 Uranium tax

 3% of value of resources severed at time of severance, except 2% of value on oil produced from wells
 averaging 10 barrels per day or less for all producing days during the tax year.
 
 2% of the value of the uranium produced each year in excess of $5 million gross value.

 Nevada

 Net proceeds of minerals tax
 
 
 
 
 
 
 
 
 Oil and gas administrative fee

 Dependent on the ratio of the net proceeds to the gross proceeds of the operation as a whole: the rate is
 2% for a net-to-gross percentage of less than 10%; 2.5% for a percentage of at least 10% but less than
 18%; 3% for a percentage of at least 18% but less than 26%; 3.5% for a percentage of at least 26% but
 less than 34%; 4% for a percentage of at least 34% but less than 42%; 4.5% for a percentage of at least
 42% but less than 50%; and 5% for a percentage of 50% or more and where annual net proceeds exceed
 $4 million.
 
 20¢ per barrel of oil or per 50,000 cubic feet of natural gas, as appropriate.
 
 Fee charged for oil or gas drilling may not exceed $200 per permit.

 New Hampshire

 Timber yield tax
 
 Refined petroleum products tax

 Timber, 10% of stumpage value.
 
 Uniform rate of 1/10 of 1% of fair market value per barrel at refinery.

 New Mexico

 Oil and gas production equipment tax
 
 
 Natural resources severance tax
 
 
 
 
 Oil and gas severance tax
 
 
 
 
 
 
 
 Oil and gas conservation tax
 
 
 
 Resources excise tax; special 
 processors’ tax; and service tax
 
 
 
 
 
 Oil and gas ad valorem production tax
 
 
 Oil and gas emergency school tax
 
 
 
 
 
 Natural gas processor's tax

 Based on the taxable value of equipment at each production unit that is 27% of the value of the products of
 each such unit.
 
 Gross value less rental and royalty payments and other deductions. Tax rates are: timber and nonmetallic
 minerals, 0.125%; potash, 2.5%; copper, 0.5%; gold and silver, 0.2%; lead, zinc, molybdenum, manganese,
 thorium, rare earth and other metals, 0.125%; surface coal, 57¢ per ton plus a per-ton indexed surtax;
 underground coal, 55¢ per ton plus a per-ton indexed surtax; and uranium, 3.5%.
 
 Natural gas, natural gas from a new production well, oil or other liquid hydrocarbons, and carbon dioxide,
 3.75% of the taxable value of the products. Oil and other liquid hydrocarbons from qualified enhanced
 recovery project, 1.875% of taxable value, under specified pricing circumstances. Oil and gas from well
 workover projects in excess of production projection, 2.45% of taxable value, under specified pricing
 circumstances. Natural gas removed from a stripper well property and oil and other liquid hydrocarbons
 removed from natural gas at or near wellhead from a stripper well property, 1.875% or 2.8125% of taxable
 value, under specified pricing circumstances.
 
 Generally, 0.19% of taxable value of oil, natural gas, liquid hydrocarbons, helium, non-hydrocarbon gases,
 coal, uranium, geothermal energy, and carbon dioxide. However, when the price of specified crude exceeds a
 certain amount, a 0.05% tax is added to the general rate.
 
 Resources excise tax—potash, 0.5%; molybdenum, 0.125%; and all other taxable resources, 0.75%.
 
 Special processor's tax—timber, 0.375%; potash and molybdenum, 0.125%; and all other taxable resources,
 0.75%.
 
 Service tax—same as the above rates.
 
 District rate for nonresidential property imposed on the assessed value of products severed and sold from
 each production unit, generally.
 
 3.15% of the taxable value of oil and other liquid hydrocarbons removed from natural gas at or near the
 wellhead or of carbon dioxide; 4% of the taxable value of natural gas. Tax is imposed at the rate of 1.58%
 or 2.36% of the taxable value of oil and other liquid hydrocarbons removed from natural gas at or near the
 wellhead from a stripper well property, under specified pricing circumstances; 2% or 3% of the taxable value
 of natural gas removed from a stripper well property, under specified pricing circumstances.
 
 From July 1, 2011, through June 30, 2012, the rate is 0.0205 per mmbtu.

 North Carolina

 Primary forest product assessment
 
 
 
 Oil and Gas Conservation Tax

 50¢ per 1,000 board feet for softwood products measured in board feet; 40¢ per 1,000 board feet for
 hardwood and bald cypress products measured in board feet; 20¢ per cord for softwood products measured
 in cords; 12¢ per cord for hardwood and bald cypress products measured in cords.
 
 Maximum of five mills/barrel of oil and 0.5 mill/1,000 cubic feet of gas

 North Dakota

 Severance taxes (energy minerals,
 conservation, and precious metals
 taxes)

 Energy minerals—4.5% of the taxable value of any energy minerals severed and saved, plus $0.0024 per 
 $1.00 of taxable value conservation tax.
 
 Precious metals—Gross yield tax—gold—$4 per ounce severed during a quarter if the average price of gold is
 $800 per ounce or greater; $3 if the average price is $700 per ounce or greater; $2 if the average price is
 $600 per ounce or greater; and $1 if the average price is $500 per ounce or greater.

 Net profits tax—gold and silver—10% of the net profits from the sale of gold and silver severed in the state.
 
 Owners’ tax—8% of the value received for the right to sever gold and silver by an owner of a royalty
 interest, an overriding royalty, or a profits or working interest.

 Ohio

 Resources severance taxes
 
 
 
 
 
Oil & Gas Marketing Program
 Assessment

 Coal, 10¢ per ton (plus an additional $0.012 per ton for surface-mined coal, and an additional 14¢ per ton,
 generally, on a permit holder that has not posted a full-cost bond); The tax rate for clay, sandstone, shale,
 conglomerate, gypsum and quartzite is 1¢ per ton; The tax rate for dolomite, gravel, sand and limestone is 2¢
 per ton; The tax rate for natural gas is 2.5¢ per 1,000 cubic feet; The tax rate for oil is 10¢ per barrel; The
 tax rate for salt is 4¢ per ton.
 
 An operating committee can levy an assessment on the production of oil and natural gas for the purposes of
 a marketing program. The assessments cannot exceed 1 cent for every gross barrel of il and 1/10th of 1 cent
 per thousand cubic feet of natural gas produced.

 Oklahoma

 Severance taxes (gross production tax
 and petroleum oil and gas excise tax)

 Gross production tax—Minerals and recovered oil—asphalt and mineral ores (other than gold and silver),
 0.75% of gross value; uranium, 5% of gross value; and oil recovered or from unknown sources, 12.5%.
 
 Oil—through June 30, 2013, the tax on the production of oil based on a per barrel measurement for barrels
 that cost, on average, at least $17.00 is 7%. If the average price of a barrel is less than $17.00, but at least
 $14.00, the tax is set at 4%. If the average price of barrels drops below $14.00, then the tax is set at 1%. 
 Effective as of July 1, 2013, the tax is set at 7%.
 
 Gas—through June 30, 2013, the tax on the production of gas, based on an average price of gas that is
 more than $2.10 per thousand cubic feet (mcf), is 7%. If the average price of gas is less than $2.10, but at
 least $1.75, then the tax is set at 4%. If the average price of gas drops below $1.75, then the tax is set at
 1%. Effective as of July 1, 2013, the tax is set at 7%.

 Petroleum oil and gas excise tax—Additional tax on gross value of oil or gas produced in state, 0.095% 
 (0.085%, as of July 1, 2016).

 Oregon

 Oil and gas gross production (privilege)
 tax

 Forest product taxes

 6% of gross value at well on all oil and gas produced within the state.
 
 Privilege tax on harvesting timber—The tax rate for the 2010–2011 biennium is $3.5750 per 1,000 ft., board
 measure, of merchantable forest products harvested.

 South Carolina

 Primary forest product assessment

 Primary forest product assessment—50¢ per 1,000 board ft. for softwood, veneer logs and bolts and all
 other softwood products normally measured in board feet; 25¢ per 1,000 board ft. for hardwood and
 sawtimber, veneer and all other hardwood products normally measured in board feet; 20¢ per cord for
 softwood pulpwood and other softwood products normally measured in cords; and 7¢ per cord for hardwood
 pulpwood and other hardwood products normally measured in cords.

 South Dakota

 Severance taxes (energy minerals,
 conservation, and precious metals
 taxes)

 Energy minerals—4.5% of the taxable value of any energy minerals severed and saved, plus $0.0024 per
 $1.00 of taxable value conservation tax.
 
 Precious metals—Gross yield tax—gold—$4 per ounce severed during a quarter if the average price of gold is
 $800 per ounce or greater; $3 if the average price is $700 per ounce or greater; $2 if the average price is
 $600 per ounce or greater; and $1 if the average price is $500 per ounce or greater.
 
 Net profits tax—gold and silver—10% of the net profits from the sale of gold and silver severed in the state.
 
 Owners’ tax—8% of the value received for the right to sever gold and silver by an owner of a royalty
 interest, an overriding royalty, or a profits or working interest.

 Tennessee

 Oil and gas severance tax
 
 Coal severance tax

 3% of the sales price of oil and gas.
 
 75¢ per ton beginning July 1, 2011, through June 30, 2013.

 Texas

 Coastal protection fee
 
 
 
 
 Severance taxes

 Coastal protection fee—The tax rate on returns for transfers after September 1, 2005 is 1.333¢ per bbl. of
 crude oil or condensate. The tax rate for returns for transfers prior to September 1, 2005, is 2¢ per bbl. of
 crude oil or condensate. The rate can vary or the fee can be suspended, depending on the balance in the
 Coastal Protection Fund.
 
 Oil—4.6% of market value; 2.3% of market value for oil produced from qualified new or expanded enhanced
 recovery projects; 0.0% for oil produced from inactive wells. Additional regulatory tax of 3/16 of a cent per
 bbl ($0.001875) and regulatory fee of 5/8 of a cent per bbl ($0.00625).
 
 Natural gas—7.5% of market value; 4.6% of market value for condensate production tax. Additional
 regulatory fee of 0.0667¢ per thousand cubic feet of gas produced.
 
 Sulphur—$1.03 per long ton or fraction thereof produced or manufactured.
 
 Cement—55¢ per ton or 2.75¢ per 100 lbs., or fraction thereof.

 Utah

 Severance tax; oil and gas conservation
 tax

 3% of the value up to the first $13 per barrel for oil and up to and including $1.50 per MCF for natural gas,
 and 5% of the value from $13.01 and over per barrel for oil and $1.51 and over per MCF for natural gas.
 Liquid natural gas, 4% of value.
 
 Mining severance tax—After an initial $50,000 gross value exemption, a tax of 2.6% is imposed on the
 taxable value of metalliferous minerals sold or shipped out of the state. Taxable value of metalliferous
 minerals (all metals except beryllium) sold or otherwise disposed of, 30% of the gross proceeds. For
 metalliferous minerals sold or otherwise disposed of that are sold or shipped out of state in the form of ore,
 taxable value is 80% of the gross proceeds. Beryllium, taxable value 125% of direct mining costs incurred.
 Minerals remaining stockpiled for more than two years are subject to tax.

 Conservation tax—$0.002 per $1 of market value at the well of oil and gas.

 Brine shrimp royalty—3.75¢ per pound of brine shrimp eggs.

 Virginia

 Forest products tax
 
 
 
 
 
 
 Reclamation tax

 Pine products—lumber, $1.15 per 1,000 ft. board measure or log scale, International ¼″ Kerf Rule;
 hardwood, cypress and all other species, 22.5¢ per 1,000 feet board measure. In the alternative, a taxpayer
 may elect to pay 20¢ per ton of pine log and 4¢ per ton of other type of logs received.
 
 Small manufacturers—flat tax, $230 per year for 300,000 board feet or less, $460 for more than 300,000
 and less than 500,000 board feet.
 
 Reclamation tax—4¢ per clean ton of coal produced by permitted surface mining operation; 3¢ per ton of coal
 produced by permitted deep mining operation; 1.5¢ per ton of coal processed or loaded by permitted
 preparation or loading facilities. Payments cease when revenue generated exceeds specified amounts.

 Washington

 Timber and forest lands taxes
 
 Uranium and thorium milling tax
 
 Enhanced food fish tax

 Timber harvesters pay a 5% tax on stumpage value of timber harvested.
 
 5¢ per pound of uranium or thorium compound milled out of raw ore.
 
 It is a tax on the first commercial possession of certain fish within the state. The tax is measured by the value
 of the fish when first landed.

 West Virginia

 Severance taxes

 Coal—5% (includes the 0.35% additional severance tax on coal for the benefit of counties and
 municipalities); minimum coal severance tax, 75¢ per ton; special tax on coal production, 2¢ per ton;
 limestone or sandstone—5%; natural gas or oil—5%; timber—1.22% (timber tax suspended for tax years
 2010 through 2012); other natural resources—5%; coal refuse or gob piles, 2.5%.
 
 Additional taxes: clean coal—56¢ per ton; natural gas—4.7¢ per mcf; timber—2.78%. Special reclamation tax
 on clean coal—14.4¢ per ton.

 Wisconsin

 Iron ore tax
 
 Iron ore concentrates—5¢ per ton.
 
 Metallic minerals occupation tax
 
 
 
 
 
 Timber yield tax

 Iron ore concentrates—5¢ per ton.
 
 Petroleum products tax—5¢ per ton of crude oil handled.
 
 Percentage of net proceeds—rates change yearly. Current rates are: $0 to $516,700, 0%; $516,701 to
 $10,335,900, 3%; $10,335,901 to $20,671,800, 7%; $20,671,801 to $31,007,900, 10%; $31,007,901 to
 $41,344,100, 13%; $41,344,101 to $51,679,600, 14%; over $51,679,601, 15%.
 
 Oil and gas severance tax—7% of market value of total production of oil or gas during previous year.
 
 5% of stumpage value of merchantable timber cut on managed forest lands.

 Wyoming

 Oil and gas conservation charge
 
 
 Severance taxes

 Assessed on fair market value of all oil and gas produced, transported, or sold in Wyoming—may not exceed
 8/10 of a mill ($0.0008); currently 4/10 of a mill ($0.0004).
 
 Gross products tax—6% on crude oil, lease condensate, natural gas, and helium; 3.75% on value of
 underground coal; 4% of value of uranium and trona; 7% on surface coal; 2% on bentonite, sand and
 gravel, and oil shale or any other fossil fuel.

Key:
 
N/A = Severance tax not levied
 
BTU = British Thermal Unit
 
BBL = Barrel
 
Cu. Ft. = Cubic Feet
 
MCF = One thousand cubic feet
 
Mill levy = A tax on the assessed value of a property. One mill is one dollar per $1,000 of assessed value.
 
MMBTU = A thousand thousand BTUs (also expressed as MBTU – 1,000 BTUs)

 

 

Source: Commerce Clearing House State Taxes, 2012 and other sources.