It’s Time for a Real Severance Tax in Pennsylvania

Stephen Herzenberg, Diana Polson |

Legislators on both sides of the aisle, and Governor Wolf, all made proposals in 2017 to enact severance taxes that would, together with the existing impact fee, raise the overall tax rate on the value of natural gas extracted (in most circumstances) to at least the 5% level that exists in West Virginia. This brief estimates the revenue for three alternative proposals: one that, combined with the impact fee, would raise the effective tax rate to 5%, one from Republican Representative Kate Harper that adds a 3.5% severance tax to the existing impact fee, and Governor Wolf’s proposed 6.5% severance tax that would allow companies to take the impact fee as a credit.