Mississippi House Bill HB255

Mississippi 2023 Regular Session

• Introduced: 1/5/23
• Refer: 1/5/23
• Failed: 1/31/23

Caption

Oil & gas severance taxes; extend repealers on lower rate for production from horizontally drilled wells.

Impact

The legislation impacts sections 27-25-503 and 27-25-703 of the Mississippi Code, which outline the taxation structure for oil and gas production. By extending these provisions, the state seeks to provide continued financial relief to producers, which may support local employment and investment in the oil and gas sectors. This could also stabilize the energy market in Mississippi by incentivizing further exploration and drilling activities in the state.

Summary

House Bill 255 aims to amend specific sections of the Mississippi Code concerning severance taxes levied on oil and natural gas production. The bill proposes to extend the repealers on provisions that establish a temporary reduced rate for these taxes on the initial oil and natural gas produced from certain horizontally drilled wells and horizontally drilled recompletion wells. The objective is to encourage the production of oil and natural gas by allowing producers to benefit from lower tax rates for a longer period.

Contention

While supporters argue that this bill is essential for sustaining the oil and gas industry in Mississippi, there may be contention around how tax incentives affect state revenue. Critics may express concerns about the long-term fiscal implications of continually extending these tax breaks, questioning whether it serves the broader interests of the state's economy. The ongoing debate is likely to focus on balancing industry support with fiscal responsibility.