Louisiana House Bill HB67

Louisiana 2016 1st Special Session

• Introduced: 2/17/16

Caption

Imposes a tax on all oil and gas that runs through pipelines located in the state

Impact

By permitting the imposition of this transportation tax, HB 67 modifies existing laws that previously prohibited local governments from levying additional taxes on natural gas. It facilitates a shift in how Louisiana can generate revenue from its significant natural gas industry. It also implies that while the tax does not apply to the production or ownership of natural gas, it does impose new fiscal responsibilities on gas transporters, promoting a structure where transporters share the cost burden with the state.

Summary

House Bill 67 introduces a tax on the transportation of natural gas through pipelines in Louisiana, specifically targeting the use of facilities exceeding one mile in length. The tax is set at fifty cents per thousand cubic feet of natural gas transported. The funds collected from this tax are to be deposited into the Fair Share Fund established in the state constitution, addressing the need for a fair revenue source to mitigate the environmental and infrastructural impacts caused by natural gas transportation. This legislative move aims to ensure that those benefiting from the state's natural resources contribute to the costs incurred by the state.

Sentiment

The sentiment surrounding the bill appears to be mixed. Proponents view the tax as a necessary step towards ensuring that oil and gas companies contribute fairly to the state, especially in light of the environmental degradation that has occurred over the years. Conversely, some stakeholders argue that additional taxes may represent an undue financial burden on businesses engaged in energy transportation, potentially leading to higher operational costs that could be passed on to consumers.

Contention

There are notable points of contention related to the bill, particularly surrounding the potential impact on the local economy and the energy sector. Critics raise concerns about how the new tax might affect the competitiveness of Louisiana's natural gas industry and whether the revenue will be used effectively to address the environmental issues exacerbated by gas transportation. The implementation of this tax could spark further debates on resource management and the balance between economic growth and environmental stewardship.