Present tax system works for Oklahoma energy industry
By Rep. Mark McBride
I recently walked the floor at the Oklahoma Oil & Gas Expo at the state fairgrounds. More than 150 exhibitors promoted their businesses to the 2,500 attendees from Oklahoma’s oil and natural gas industry. It was eye-opening.
At the Capitol, the energy industry is oftentimes only represented by the gross production tax, which is paid by oil and natural gas producers. It’s one of the few budget line items directly linked to oil and natural gas and it’s also one of the state’s most significant sources of income, trumped only by income tax, sales tax and motor vehicle tax collections.
But the businesses that support oil and natural gas producers — the vast majority of those represented at the expo — don’t pay gross production tax. Their employees do pay income taxes. They do pay sales tax on equipment used in their day-to-day business. And they do pay motor vehicle taxes on the fleet of cars and trucks they use throughout the oil field.
The economic benefit those companies bring to Oklahoma is great and reaches every county in the state.