H. B. 2749
(By Delegates Cann, Coleman, Laird,
Kominar and Jenkins)
[Introduced February 12, 1999; referred to the
Committee on Finance.]
A BILL to amend and reenact section three-a, article thirteen-a,
chapter eleven of the code of West Virginia, one thousand
nine hundred thirty-one, as amended, relating to exemptions
of certain natural gas and oil production from imposition of
the severance tax.
Be it enacted by the Legislature of West Virginia:
That section three-a, article thirteen-a, chapter eleven of
the code of West Virginia, one thousand nine hundred thirty-one,
as amended, be amended and reenacted to read as follows:
ARTICLE 13A. SEVERANCE TAXES.
§11-13A-3a. Imposition of tax on privilege of severing natural
gas or oil.
(a)
Imposition of tax. -- For the privilege of engaging or
continuing within this state in the business of severing natural
gas or oil for sale, profit or commercial use, there is hereby levied and shall be collected from every person exercising such
privilege an annual privilege tax:
Provided, That effective for
all taxable periods beginning on or after the first day of
January, two thousand, there is an exemption from the imposition
of the tax provided for in this article on the following: (1)
Free natural gas provided to any surface owner; (2) natural gas
produced from any well which produced an average of less than
five thousand cubic feet of natural gas per day during the
calendar year immediately preceding a given taxable period; (3)
any oil well which produced an average of less than one-half
barrel of oil per day during the calendar year immediately
preceding a given taxable period; and (4) all natural gas or oil
produced from any well which has not produced marketable
quantities of natural gas or oil for a period of ten calendar
years but for the two consecutive years immediately preceding the
ten-year period produced marketable quantities of natural gas or
oil.
(b)
Rate and measure of tax. -- The tax imposed in
subsection (a) of this section shall be five percent of the gross
value of the natural gas or oil produced, as shown by the gross
proceeds derived from the sale thereof by the producer, except as
otherwise provided in this article.
(c)
Tax in addition to other taxes. -- The tax imposed by this section shall apply to all persons severing gas or oil in
this state, and shall be in addition to all other taxes imposed
by law.
(d)
Effective date. -- This section, as enacted in the year
one thousand nine hundred ninety-three, shall apply to gross
proceeds derived after the thirty-first day of May of such year.
The language of section three of this article, as in effect on
the first day of January of such year, shall apply to gross
proceeds derived prior to the first day of June of such year and,
with respect to such gross proceeds, shall be fully and
completely preserved.
NOTE: The purpose of this bill is to exempt from severance
tax certain natural gas and oil production.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.