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The government receives severance tax for oil and gas extracted (0), income tax from employees working in oil industry, and the government is paid for the lease

The government receives severance tax for oil and gas extracted (0), income tax from employees working in oil industry, and the government is paid for the leases and royalty interest for production on the leases they grant. (0) https://tax.ohio.gov/help-center/faqs/severance#:~:text=The%20severance%20tax%20is%20paid,the%20sale%20of%20natural%20resources https://tax.ohio.gov/help-center/faqs/severance#:~:text=The%....

littlestymaar 3y ago
The fact that your link returns a ”403: forbidden” error is a delicious irony.
- orangepurple 3y ago
  Are you connecting from outside the US?
vkou 3y ago
> income tax from employees working in oil industry, Everyone pays income taxes. If the mob starts paying income taxes, is that a good reason to bring racketeering back? Why are they paying the same mineral rights fees for extracting from a protected state park, as they would from non-protected land? Is a park designation utterly meaningless in Ohio?
- calamari4065 3y ago
  Strictly speaking, criminal gains are taxable and you are technically required to declare any illegal income on your taxes. As for racketeering, it never left. It's just a government institution now.
- balderdash 3y ago
  But oil is not uniformly distributed, if it is a marginal decision (probably unlikely in this case) then those are jobs not needed, and taxes forgone, the logic is sound on truly marginal cases, but it’s probably some fraction of that that is truly marginal
onlyrealcuzzo 3y ago
$0.1 tax per barrel of oil for anyone interested. It's about a ~0.15% revenue tax at current oil prices. I would put this in the category of almost entirely benefiting whoever has the right connections to the right politicians - with a meaningless tax to make it appear otherwise.
- alach11 3y ago
  The royalty interest is probably the largest take for the government in this case. Typically that would be between 15% and 20% of the gross revenue generated by the leases.
  - balderdash 3y ago
    25% is pretty common, I’ve seen 28%
- JumpCrisscross 3y ago
  > It's about a ~0.15% revenue tax at current oil prices Out of curiosity, what is it on gross profit per barrel?
  - balderdash 3y ago
    I think lifting cost are like ~$15/bbl so at $60/bbl (ex royalties on $80)it’s about double, but still not much, but you have to factor in the capital costs / IRR math, and that’s where it has the bigger impact - but no one is really making a marginal decision based on this
lowbloodsugar 3y ago
Which is fucking insane, right? Imagine if I could walk into your house, take all your stuff, and pay you a "severance" tax of 0.125%.
- balderdash 3y ago
  The royalty is like ~20%, the severance tax isn’t super meaningful here.

littlestymaar 3y ago

The fact that your link returns a ”403: forbidden” error is a delicious irony.

orangepurple 3y ago
Are you connecting from outside the US?

vkou 3y ago

> income tax from employees working in oil industry, Everyone pays income taxes. If the mob starts paying income taxes, is that a good reason to bring racketeering back? Why are they paying the same mineral rights fees for extracting from a protected state park, as they would from non-protected land? Is a park designation utterly meaningless in Ohio?

calamari4065 3y ago
Strictly speaking, criminal gains are taxable and you are technically required to declare any illegal income on your taxes. As for racketeering, it never left. It's just a government institution now.
balderdash 3y ago
But oil is not uniformly distributed, if it is a marginal decision (probably unlikely in this case) then those are jobs not needed, and taxes forgone, the logic is sound on truly marginal cases, but it’s probably some fraction of that that is truly marginal

onlyrealcuzzo 3y ago

$0.1 tax per barrel of oil for anyone interested. It's about a ~0.15% revenue tax at current oil prices. I would put this in the category of almost entirely benefiting whoever has the right connections to the right politicians - with a meaningless tax to make it appear otherwise.

alach11 3y ago
The royalty interest is probably the largest take for the government in this case. Typically that would be between 15% and 20% of the gross revenue generated by the leases.
- balderdash 3y ago
  25% is pretty common, I’ve seen 28%
JumpCrisscross 3y ago
> It's about a ~0.15% revenue tax at current oil prices Out of curiosity, what is it on gross profit per barrel?
- balderdash 3y ago
  I think lifting cost are like ~$15/bbl so at $60/bbl (ex royalties on $80)it’s about double, but still not much, but you have to factor in the capital costs / IRR math, and that’s where it has the bigger impact - but no one is really making a marginal decision based on this

lowbloodsugar 3y ago

Which is fucking insane, right? Imagine if I could walk into your house, take all your stuff, and pay you a "severance" tax of 0.125%.

balderdash 3y ago
The royalty is like ~20%, the severance tax isn’t super meaningful here.