SRC-JRN S.B. 1531 75(R)   BILL ANALYSIS


Senate Research Center   S.B. 1531
By: Brown
Finance
4-14-97
As Filed


DIGEST 

Currently, state law provides for the imposition and rate of a gas
severance tax.  Because the value of gas is based on the location of the
gas at the mouth of a well minus costs associated with moving the gas from
the wellhead to the point of sale, the process of approving marketing-cost
refunds is difficult to measure.  This bill amends the gas severance tax
rate imposed, and provides that the market value of gas is the value of
the gas at the mouth of the well from which it is produced without
deducting the costs of marketing the gas. 

PURPOSE

As proposed, S.B. 1531 amends the gas severance tax rate imposed, and
provides that the market value of gas is the value of the gas at the mouth
of the well from which it is produced without deducting the costs of
marketing the gas. 

RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 201.052(a), Tax Code, to require the tax imposed
by this chapter to be at a rate of 6.9 percent, rather than 7.5 percent,
of the market value of gas produced and saved in this state by the
producer.   

SECTION 2. Amends Section 201.101, Tax Code, as follows:

Sec. 201.101. MARKET VALUE.  Provides that the market value of gas is its
value at the mouth of the well from which it is produced without deducting
the costs of marketing the gas. 

SECTION 3. Effective date: September 1, 1997.
 Makes application of this Act prospective.

SECTION 4. Emergency clause.