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A BILL TO BE ENTITLED
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AN ACT
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relating to severance tax credits for qualifying low-producing |
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wells. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Sections 201.059(b), (c), (d), and (e), Tax |
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Code, are amended to read as follows: |
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(b) Each month, the comptroller shall certify the average |
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taxable price of gas[, adjusted to 2005 dollars,] during the |
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previous three months based on various price indices available to |
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producers, including prices reported by Henry Hub, Houston Ship |
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Channel, Mississippi Barge Transport, New York Mercantile |
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Exchange, or other spot prices, as applicable. The comptroller |
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shall publish certifications under this subsection in the Texas |
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Register. |
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(c) An operator of a qualifying low-producing well is |
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entitled to a 25 percent credit on the tax otherwise due on gas |
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produced and saved from that well during a month if the average |
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taxable price of gas certified by the comptroller under Subsection |
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(b) for the previous three-month period is more than $4.50 [$3] per |
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mcf but not more than $5 [$3.50] per mcf. |
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(d) An operator of a qualifying low-producing well is |
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entitled to a 50 percent credit on the tax otherwise due on gas |
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produced and saved from that well during a month if the average |
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taxable price of gas certified by the comptroller under Subsection |
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(b) for the previous three-month period is more than $4 [$2.50] per |
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mcf but not more than $4.50 [$3] per mcf. |
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(e) An operator of a qualifying low-producing well is |
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entitled to a 100 percent credit on the tax otherwise due on gas |
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produced and saved from that well during a month if the average |
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taxable price of gas certified by the comptroller under Subsection |
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(b) for the previous three-month period is not more than $4 [$2.50] |
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per mcf. |
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SECTION 2. Section 202.058(a)(2), Tax Code, is amended to |
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read as follows: |
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(2) "Qualifying low-producing oil lease" means a well |
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classified as an oil well that is part of a lease whose production |
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during a 90-day period is less than: |
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(A) 15 barrels of oil per day of production; or |
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(B) 10 [five] percent recoverable oil per barrel |
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of produced water. |
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SECTION 3. Sections 202.058(c), (d), (e), and (f), Tax |
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Code, are amended to read as follows: |
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(c) Each month, the comptroller shall certify the average |
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taxable price of oil[, adjusted to 2005 dollars,] during the |
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previous three months based on various price indices available to |
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producers, including the reported Texas Panhandle Spot Price, West |
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Texas Intermediate Crude Spot Price, West Texas sour at 34 gravity |
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[New York Mercantile Exchange], or other spot prices, as |
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applicable. The comptroller shall publish certifications under |
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this subsection in the Texas Register. |
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(d) An operator of a qualifying low-producing lease is |
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entitled to a 25 percent credit on the tax otherwise due on oil |
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produced from that lease during a month if the average taxable price |
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of oil certified by the comptroller under Subsection (c) for the |
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previous three-month period is more than $44 [$25] per barrel but |
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not more than $46 [$30] per barrel. |
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(e) An operator of a qualifying low-producing lease is |
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entitled to a 50 percent credit on the tax otherwise due on oil |
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produced from that lease during a month if the average taxable price |
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of oil certified by the comptroller under Subsection (c) for the |
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previous three-month period is more than $38 [$22] per barrel but |
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not more than $44 [$25] per barrel. |
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(f) An operator of a qualifying low-producing lease is |
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entitled to a 100 percent credit on the tax otherwise due on oil |
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produced from that lease during a month if the average taxable price |
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of oil certified by the comptroller under Subsection (c) for the |
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previous three-month period is not more than $38 [$22] per barrel. |
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SECTION 4. (a) Sections 201.059(g) and 202.058(h), Tax |
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Code, are repealed. |
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(b) This section takes effect August 27, 2007. |
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SECTION 5. The change in law made by this Act does not |
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affect tax liability accruing before the effective date of this |
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Act. That liability continues in effect as if this Act had not been |
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enacted, and the former law is continued in effect for the |
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collection of taxes due and for civil and criminal enforcement of |
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the liability for those taxes. |
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SECTION 6. Except as otherwise provided by this Act, this |
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Act takes effect September 1, 2007. |