Notably absent from the current discussion on tax reform is severance tax — the levy which states everywhere take on oil and minerals extracted for commercial use.
Utah's version of severance tax is virtually non-existent, and the legislative analyst estimates that simply bringing it up to regional standards would produce a cool $75 million in yearly revenue.
Utah's current severance taxes are simply a gift to the fossil fuel companies — about 3% on oil and natural gas, 0% on stripper (low production) wells, and 0% on coal.
Across the border in Wyoming, the rates are crude oil, 6%; stripper oil, 4%; tertiary oil, 4%; natural gas, 6%; surface coal, 7%; underground coal, 3.75%. Other western states are similar.
The few discussions Utah lawmakers have ever had about severance tax have been shut down quickly by the fossil fuel lobby, to which local officials, even more than the U.S. Congress, remain in thrall.
This situation should anger Utahns no less than the many other ways that Utah scrapes bottom, such as education and gender equality.
Tom Horton, Park City
Donate to the newsroom now. The Salt Lake Tribune, Inc. is a 501(c)(3) public charity and contributions are tax deductible