– Rep. Donna Oberlander (R-Clarion/Armstrong/Forest), chairman of the House Gas and Oil Caucus, today offered her thoughts on the governor’s proposal to levy a severance tax on all natural gas drilling in the Commonwealth:
“The proposal put forth by the new governor this week raises several red flags, in that the administration is not only looking to tax unconventional drilling but also shallow wells that are located throughout western Pennsylvania. Taxing an industry at this high of a rate – a total of 7.5 percent when adding together the 5 percent on the value of the gas and another tax on each 1,000 cubic feet on top of an exceptionally high corporate income tax – clearly sends a signal to these job creators that they are not welcome in our Commonwealth.
“I am very concerned that a tax at this level would not only directly harm the production of natural gas, perhaps raising the cost on consumers, but hinder the efforts of indirect businesses – manufacturers that consumer large quantities of energy and local merchants within heavy shale development areas, among a vast array of others. During a hearing last fall, we heard from experts that the low cost of natural gas from the Marcellus Shale has led manufacturers and companies to use their savings for additional manpower and equipment – all which are positive signs for a thriving economy.
“As we learn more about the governor’s plan, I’ll be closely looking at the specifics and keeping in mind the type of short- and long-term consequences of such a proposal. At first glance, however, I am very concerned about the impact of such a high tax on our Commonwealth’s job creators and the ripple effect throughout our communities.”
Representative Donna Oberlander
Pennsylvania House of Representatives
Media Contact: Jennifer Keaton