By Craddick H.B. No. 1328
74R5156 CBH-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to tax credits for the discovery of new oil and gas
1-3 fields.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. The heading to Section 204.002, Tax Code, is
1-6 amended to read as follows:
1-7 Sec. 204.002. TAX CREDIT FOR NEW FIELD DISCOVERIES DURING
1-8 1994.
1-9 SECTION 2. Chapter 204, Tax Code, is amended by adding
1-10 Section 204.0025 to read as follows:
1-11 Sec. 204.0025. TAX CREDIT FOR NEW FIELD DISCOVERIES DURING
1-12 1996. (a) Persons who obtain a certification of a new field
1-13 discovery from the commission as the result of a discovery well
1-14 spudded during the period of January 1, 1996, through December 31,
1-15 1996, are eligible for a tax credit applicable against the taxes
1-16 imposed by Chapters 201 and 202 upon the commission notifying the
1-17 comptroller that 357 new fields have been discovered as the result
1-18 of wells spudded during 1996.
1-19 (b) The amount of the tax credit shall be as follows:
1-20 (1) $10,000 for each discovery well spudded during
1-21 1996 if the number of discovery wells spudded that year is 357 or
1-22 more, but less than 457;
1-23 (2) $25,000 for each discovery well spudded during
1-24 1996 if the number of discovery wells spudded that year is 457 or
2-1 more.
2-2 SECTION 3. Section 204.003(a), Tax Code, is amended to read
2-3 as follows:
2-4 (a) The commission shall have the authority to establish the
2-5 method of determining whether a new field has been discovered. The
2-6 commission may require an applicant for a new field discovery to
2-7 provide the commission with any relevant information required to
2-8 administer this chapter. Upon determining that a well spudded
2-9 during 1994 or 1996 resulted in the discovery of a new field, the
2-10 commission shall furnish a certificate of new field discovery to
2-11 the applicant.
2-12 SECTION 4. Section 204.004, Tax Code, is amended to read as
2-13 follows:
2-14 Sec. 204.004. TAX CREDIT FOR ADDITIONAL WELLS IN A NEW
2-15 FIELD. (a) Upon the commission notifying the comptroller that 842
2-16 discovery wells have been spudded in 1994, persons obtaining a new
2-17 field discovery during that year shall be eligible for an
2-18 additional $25,000 tax credit for each additional well spudded and
2-19 producing from that field, within 10 years from the spud date of
2-20 the discovery well. The tax credit is available to persons who
2-21 obtain a new field discovery regardless of who drills the
2-22 additional well.
2-23 (b) Upon the commission notifying the comptroller that 557
2-24 discovery wells have been spudded in 1996, persons obtaining a new
2-25 field discovery during that year shall be eligible for an
2-26 additional $25,000 tax credit for each additional well spudded and
2-27 producing from that field, within 10 years from the spud date of
3-1 the discovery well. The tax credit is available to persons who
3-2 obtain a new field discovery regardless of who drills the
3-3 additional well.
3-4 SECTION 5. Section 204.006(a), Tax Code, is amended to read
3-5 as follows:
3-6 (a) Tax credits earned under this chapter may only be
3-7 applied against the severance taxes imposed by Chapters 201 and 202
3-8 of this code. The tax credit earned under Section 204.002 may not
3-9 be used until September 1, 1995, and may not be used after August
3-10 31, 2000. The tax credit earned under Section 204.0025 may not be
3-11 used until September 1, 1997, and may not be used after the 10th
3-12 anniversary of the date on which the credit was earned. A tax
3-13 credit may be applied to either oil or gas severance taxes
3-14 regardless of the field from which the production originates.
3-15 SECTION 6. Section 204.007, Tax Code, is amended to read as
3-16 follows:
3-17 Sec. 204.007. TRANSFERABILITY OF TAX CREDIT. A <The> tax
3-18 credit earned under this chapter is fully transferable.
3-19 SECTION 7. This Act takes effect September 1, 1995.
3-20 SECTION 8. The importance of this legislation and the
3-21 crowded condition of the calendars in both houses create an
3-22 emergency and an imperative public necessity that the
3-23 constitutional rule requiring bills to be read on three several
3-24 days in each house be suspended, and this rule is hereby suspended.