The Oklahoma City times. [volume] (Oklahoma City, Okla.) 1908-1984, 1915-07-21
PRODUCTION TAX
FUND HELD Up
Question Whether TO BE Paid Back
TO Taxpayers or Into
Treasury
AWAIT DECISION OF COURT
Nearly All Oil and Gas Producer,
In State Interested In Out
come of Case
AWAIT DECISION OF COURT
" PRODUCERS throughout tn,

o. PRODUCERS throughout tn,
~ tate. following arguments before
lh" state upIrmc court late yesterday
m the ease Of the Wolverine OH Co
VS.. the state. are auNiousy uwultin,
lh" courts decision, rs the vulidiB
OF the gross promotion tax law Is IN.
VOWED IN the cu,r.
The cu,e Is one NJ such importance
That 10 is expected the court will give
lts Immediate consideration, as n yasi
amount of money Is tied up that ought
"a bc paid into the state treasury oI
refunded tu the taxpayers. Another
quarterly iuslalmuut Of the gross prO
ductiou tax Is due by August /. and
III" two payment, viii amount to
large sum Of money. The money de
rived from this source IL being held
10y the state auditor in special fund
awaiting the expected decision. II
also Is supposed that the state bnRr0
~ equalization is awaiting decision
before making the state levy. In order
ihht they eau make an eatlmntp of
what revenue II any, Is to be derived
from this source.
History Of the Case
The Wolverine OF company. which
has headquarters at Tulsa. operate,
oil land In the Osage nation and on
restricted Indian lands Of the Five
Civilized Tribes " Indian Territory
proper, and also commercial lands
lands made over from one American
citizen to another without government
tai interference.
Inc case arose by agreement under
the act Of 1915. The OIL producerS
were required to pay this gross pro.
nuctloh thN on the entire production
they had, including the royalty inter
est The law provided that IL should
be paid 10 the state auditor; that any
objections they might make should be
offered 10 the state auditor the hear
ing 10 be held before the state board
OF equalization
scores NJ companies paid the gross
production tax under protest, and the
hniter came up for hearing before
the state board. IL was then agreed
that all proceedings be continued until
this ease could be decided that this
should he n test case.
Practically all NJ the comnanies NJ
Interest about 200 In number-per
ticlpoted In the agreement and their
attorneys took part In preparing the
agreed statement ~ facts
Prime Issues Involved
Tho cnSc Involves. I The validity
NJ the law rs n whole. .. II the law ia
valid ns whole. whether Il reduIrcs
the producer 10 pay the tax on the
ROYALTY interest g. Whether the law
applies I'm the Usage nation at all on
account NJ the Usage land In that ma.
/ tion being federal agency They
operate under lease made directly bv
act ~ congress and exercised hy fed
erRl agents The property NJ feder
81 agent can he taxed but the agency
tself cRn not hr taxed.
z Judge e. II Ames. attorney for the
company, said THE position | have
taken Is that the law as a whole IL
valid. and that II IL the only method
provided for taxing leasehold inter.
ests and the material aud equipment
OF wells, hut that as applied To the
royalty Interest, II does not require
the lessee 10 pay the tax, because he
does not own the royalty aud that II
It Is constitutional M requiring the
lessee to pay the tax on royalty, then
the law Rs whole n invalid"
Attorney Herbert n. Mason. repre-
scntlnr the law firm " Carroll 4 Ma.
SON, Tulsa, asserted he believed the
law TO he unconstitutional FOR the
reason II sought IN impose levy of
more than 9h mills. the maximum
fixed by law This was met nv the
states attorneys with the claim that
II was not the land being taxed, hut
/ the products and that production tnx
Is the only scientific method" OF tar.
| Ing oil producing land.
A number NJ nmlcus curlae briefs
have been received nv the court frum
attorneys representing other com.
panies, hut not directly interested In
the case Mt hnr and these win he con
/ sldcrpd I'm arriving M n dectsion