PA Gov Wolf Asks for Severance Tax 3rd Year in a Row

Pennsylvania Gov. Tom Wolf is…what adjective can we use? Recalcitrant. Stubborn. Pigheaded. Stupid. Perhaps all of the above. Wolf is clearly in over his head and the most ineffective PA governor in more than a generation. When he assumed office in 2015, he floated a budget calling for a new 5% severance tax on the Marcellus industry–a tax which even his supporters admitted would be closer to 17% (see PA Official Admits Wolf Severance Tax Highest in Nation @ 17.3%). Such a tax would literally kill the entire industry. That budget deal was a disaster. Wolf held up the budget for nine months into the new budget year, and finally caved (see Hubris: PA Gov. Wolf Caves on Budget, then Claims He Won). Beaten but unrelenting, Wolf came back last year with yet another severance tax proposal–this time an astonishing 6.5% tax (see More on Wolf’s New 6.5% Severance Tax – What Could of Been). What a putz. Yes, he lost again. Republicans held firm and he dropped his demand. As we’ve chronicled repeatedly, Wolf insists on such a tax because of his quid pro quo payoff to teachers unions for their support in getting him elected. Sleazy. PA already has a higher tax rate on natural gas than other oil and gas producing states. PA has an impact fee plus a corporate income tax. The two together are, on average, higher than the severance tax rates in Texas, Oklahoma, Louisiana, Colorado and other o&g states. We’ve already seen big Marcellus drillers leave and go to other states. A severance tax will greatly reduce the amount of drilling in PA. So, it’s now Wolf’s third year and he is about to release another budget. And you will not believe it. This dolt is calling for a severance tax again! Third year in a row! But he won’t say how high of a tax, at least not yet…

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