Relating to the administration of and exemptions from the gas production tax.
Impact
By clarifying the tax administration for gas production, SB997 intends to enhance compliance among gas producers while providing necessary exemptions to encourage production. The amendments will affect how producers report their gas output as well as the information first purchasers must report regarding their transactions. These changes could lead to an increase in gas production within the state by simplifying the tax compliance process for producers, thus potentially benefiting the state's energy sector economically.
Summary
SB997 aims to amend the administration and exemptions related to the gas production tax within the Texas Tax Code. The bill includes adjustments to existing exemptions such as those outlined in Sections 202.056 to 202.060, thereby impacting how gas producers are taxed. It is expected to streamline tax reporting requirements, particularly concerning the information producers must provide regarding gas production and sales, which is filed with the comptroller.
Contention
Although the bill streamlines certain processes, there may be concerns regarding the potential for decreased revenue from gas taxes if more producers utilize exemptions. Additionally, stakeholders in the energy sector may debate the efficacy and necessity of these exemptions, questioning whether they adequately address the broader implications for environmental regulations and local governance relating to gas production activities. Furthermore, transparency in how exemptions apply may spark discussions among policymakers about the equity of tax benefits across different sectors.
Relating to an exemption from ad valorem taxation of a portion of the appraised value of tangible personal property that is held or used for the production of income and a franchise tax credit for the payment of certain related ad valorem taxes.
Relating to state and municipal motor fuel taxes; providing civil penalties; creating criminal offenses; requiring occupational licenses; authorizing the imposition of taxes; providing for increases and decreases in the rates of taxes.
Relating to an exemption from the severance tax for gas produced from certain wells that is consumed near the well and would otherwise have been lawfully vented or flared.