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Natural gas industry along with local and regional leaders oppose severance tax

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(WBRE/ WYOU)- Pennsylvania is sometimes called “the Texas of the Northeast” in some circles.

That’s because the natural gas industry has become one of the largest sources of income for the state. 

 The governor is proposing to put a severance tax on the industry to rebuild the state.

The industry hit back hard on the proposal.

“The impact tax is real. We pay it,” Robert Boulware, director of Seneca Resources said.

The impact fee is a tax on the natural gas industry. The tax was implemented  in 2012 and has racked in more than a billion dollars for local communities since enacted.

“Pennsylvania is the only state that has an impact fee. We’re the only state that has figured out how to actually get the money where the impact is,” Senator Gene Yaw, of district 23 said.

The argument in the legislature right now is whether to keep the impact fee, where the money goes to local communities – or impose a severance tax with the money going to the state.

Or maybe even do both! 

“We think the impact tax is perfect because it drives money back into local government and funds critical programs for governments,” Dave spigelmyer, President of Marcellus Shale Coalition said.

Historically, the money has been spent on everything from municipal buildings to parks.

“We believe the fairest way to tax this industry is already in place with the impact tax,” Jason Fink, president/ CEO of Williamsport/Lycoming Chamber of Commerce said.

Governor Tom Wolf wants to implement a severance tax to restore Pennsylvania. But many don’t think the state should go that route.

“What the governor is proposing is putting another tax on top of the impact tax. I urge caution,” Representative Jeff Wheeland, of district 83 said.
 
Wheeland fears that if a severance tax is implemented, it will drive gas companies out of the commonwealth. West Virginia, Ohio Arkansas and Colorado are the states that already have a severance tax.

The severance tax proposal has failed in each of the last three legislative sessions.


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