Additional Energy Taxes a “Gut Punch” to Pa. Families

For the fifth year, Governor Wolf has proposed a massive tax increase on Pennsylvania’s energy job creators that threatens economic growth and burdens hard-working families with higher energy costs.

As in previous years, the proposal to triple-tax Pennsylvania energy has fallen flat among lawmakers, with Senate Majority Leader Jake Corman telling reporters earlier this week that the body will not address the proposal this month and the “whole issue is off for now.”

Further, Speaker of the House Mike Turzai blasted the Governor’s plan as another “job-killing tax on the natural gas production industry.”

Simply put, Pennsylvania already has a special tax on natural gas – the impact tax – that generates hundreds of millions of dollars annually for critical infrastructure programs across the entire Commonwealth.

This existing annual tax revenue, when combined with other business taxes paid by the industry, as well as lease bonuses and royalties tied to natural gas development on state land, has provided more than $5 billion in revenue since unconventional shale gas development began.

Later this month, a projected $247 million in impact tax revenues will be allocated across the Commonwealth, benefitting communities from Philadelphia to Erie and providing funding for critical environmental and public safety infrastructure needs for local communities.

“Gov. Wolf, who we deeply respect, has said that he’s ‘not a product of our political system.’ Yet today’s proposal is nothing new and certainly not a solution to Pennsylvania’s big challenges,” MSC’s Spigelmyer said in a statement. “In fact, this tax, spend and borrow approach – which has failed Pennsylvanians for far too long – will be a gut punch to hardworking families and small businesses across the energy industry and our building trades while increasing energy costs for consumers who want to pay less for the energy they need, not more.”

The Governor’s approach would triple tax Pennsylvania energy by levying the severance tax on top of the impact tax and all the other taxes paid by every business in the Commonwealth. Although Pennsylvania is blessed with an abundance of shale resources, we need a competitive business environment to be able to capitalize on this energy advantage.

Last week, local elected and business leaders convened in Lycoming County to highlight this point. Consider the views of Cogan House Supervisor Howard Fry:

“I certainly hope that Harrisburg takes a look at what the gas companies do that they aren’t required to do. They need to take a look at how those dollars are being spent because it’s so much more important than a severance tax will be.”

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