Severance Tax Will Protect Pennsylvania Taxpayers
A well-structured severance tax on natural gas production will provide Pennsylvania with a stable source of revenue for critical services, including education and health care, as well as for the environmental and local costs that come with increased drilling.
Across the country, 96% of natural gas is produced in states that have severance taxes. Pennsylvania, however, remains one of the only energy-producing states without one.
While some policymakers in Pennsylvania worry about the impact of a severance tax, studies in Wyoming, Utah and other states have shown that tax rates have little effect on natural gas production. Rather, drilling decisions are made based on the location of reserves and the expected price of natural gas.
Severance Tax Ticker
The Severance Tax Ticker tracks in real time the cost to the Commonwealth of refusing to enact a severance tax. The Ticker provides an estimate of the total revenue lost by the Commonwealth since October 1, 2009 by not having a severance tax in place.
Severance Tax Delay Costs Pennsylvania
82,743,878
PBPC Research and Reports on Severance Tax
The Pennsylvania Budget and Policy Center has produced several reports on the proposed severance tax on natural gas production.
In April 2009, PBPC released a comprehensive report on severance taxes, titled, “Responsible Growth: Protecting the Public Interest with a Natural Gas Severance Tax.” It examined the potential costs of increased natural gas drilling on Pennsylvania taxpayers and the environment, how severance taxes are structured in other states, and what lessons Pennsylvania can learn from them.
Since then, PBPC has produced a variety of research and policy papers on the severance tax. You can access our severance tax reports and research below.
Responsible Growth: Protecting the Public Interest with a Natural Gas Severance Tax
The Full Report, April 2009
Four-page Report Summary, April 2009
Press Release, April 2009
Video of Severance Tax Paper Press Conference, April 2009
Media Coverage on PBPC's Severance Tax Report, April-May 2009
Other Severance Tax Reports & Resources
How to Structure a Severance Tax that is Fair to Pennsylvanians
August 2010
Table Detailing Natural Gas Severance Tax Rates in Other States
October 2009
Reality Check: Natural Gas Industry Report Falsely Claims Sky Will Fall if Severance Tax Enacted
October 2009
Shared Costs, Shared Resources: State Distribution of Severance Tax Revenues
June 2009
Marcellus Shale Forum
View video from a forum on natural gas drilling in the Marcellus Shale
January 2010
