Lawmakers should lower the state's severance tax - the tax imposed when oil or gas is removed from a well. Reducing severance taxes would be the catalyst for an increased rate of return on Texas-based projects and a more attractive investment for oil and gas companies. This would also create jobs and stimulate the economy, especially in rural parts of the state where most mineral reserves are located and where economic opportunities have been few and far between recently. Additionally, new exploration and increased drilling adds to the proven mineral reserves in the state. These reserves are subject to property taxes, which are the principal source for tax revenues for public school districts and local governments.
More reserves add up to more tax revenue for schools.
The reality is that lower severance taxes means increased property taxes, jobs and economic development in rural Texas. I urge your readers to contact their state Senator and Representative in support of a severance tax reduction, which will stimulate oil and natural gas production right here in Texas.