Pennsylvania job-creators “punched back” – as the Associated Press reports – this week against the wave of new and even higher energy taxes passed recently by the state senate that will harm manufacturers, small businesses, and consumers alike.
As MSC’s Dave Spigelmyer said, Pennsylvania’s natural gas producers – which pay an impact tax that’s generated more than $1.2 billion on top of every other business tax in the state – are “paying more than its fair share” in any number of taxes. From the Pittsburgh Business Times:
“Policies matter. This is another shot across the bow of an industry that has already faced enormous price pressure.” Spigelmyer said that the natural gas industry’s tax burden is already about 9.1%, higher than any other shale-producing state.
As the Commonwealth Foundation notes:
A new natural gas gross receipts tax makes up the lion’s share of the increase. Half of Pennsylvania households will pay this tax on their home heating bills. Additionally, the Senate piled a natural gas severance tax on top of the impact tax drillers already pay.
Here’s what Pennsylvania job-creators and consumer advocates are saying about the far-reaching and negative impacts of massive energy tax hikes.
MASSIVE TAX INCREASE
- “If this Senate proposal is enacted, natural gas will be taxed at four different points. With an impact fee – or impact tax – at the drilling, with an extraction severance tax when that product is taken out of the ground. The third point will be when it’s utilized by the end-user – either residential, commercial, or industrial. If you’re a company in the natural gas business and you happen to make money after all this, then that income will be taxed as well.” – Gene Barr, Pa. Chamber of Business and Industry (StateImpact PA, 8/8/17)
THREATENS ECONOMIC GROWTH
- “This tax would provide a second thought into reinvesting.” – Mark Chasse, Industrial Energy Consumers of Pa. (DelCoTimes, 8/8/17)
- “We’re going to do whatever is necessary to convey the absolute truth of the situation that putting new taxes on this industry is going to sacrifice Pennsylvania’s future economic growth. It’s a very bad idea and it shouldn’t happen.” – David Taylor, Pa. Manufacturers Assoc. (AP, 8/8/17)
- “The severance tax on top of the state’s per-well impact fee will make drilling in Pennsylvania’s Marcellus and Utica shales less attractive at a time when Pennsylvania is in cutthroat competition for drilling dollars with Texas’ Permian Shale.” – Dave Spigelmyer (SNL Financial, 8/9/17)
- “This is the opposite outcome of what we should want. Energy should be a competitive advantage for Pennsylvania. It’s going to really hammer the employers that we already have in the state.” – David Taylor (DelCoTimes, 8/8/17)
INCREASE CONSUMER COSTS
- “It’s not transparent. Customers are going to see costs of state government on their utility bills. Using utilities as collection agents for state government isn’t good policy.” – Terry Fitzpatrick, Energy Association of Pa. (WHYY, 8/8/17)
“It really doesn’t make sense to try to solve this problem by raising consumers’ energy costs,” Fitzpatrick said. (AP, 8/8/17)
JEOPARDIZES PA’S ENERGY OPPORTUNITY
- “This industry’s paying more than its fair share and generating jobs to boot. It’s an economic opportunity for Pennsylvania, if we don’t squander it.” – David Spigelmyer (StateImpactPA, 8/8/17)