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Canton
Repository...
CPAs:
Kasich is right on the money
Can
Republicans in the Ohio House come up with another reason for opposing
Gov.
John Kasich’s plan to raise the severance tax on oil and natural gas?
Not that
they should — the tax hike is a perfectly reasonable proposition that
will
benefit Ohioans in a big way. Thankfully, the drawback some GOP
legislators are
citing doesn’t pass the calculator test.
Kasich
wants to raise to 4 percent the tax on much of the oil and gas
extracted by
horizontal fracturing. Some of his fellow Republicans say this will put
a
damper on drilling in the state. One House member said soon after
Kasich
unveiled his plan that she didn’t want to “cripple a fledgling industry
when
there’s so much potential there.”
No
crippling on my watch, Kasich has said, because even with the increase,
Ohio
taxes would remain among the lowest levied by states where drillers do
business.
This week,
the accounting firm of Ernst & Young backed him up.
The new tax
still would put Ohio 16 percent below average among major oil- and gas-
producing
states and 80 percent below the average for all taxes on drillers, the
firm’s
study found.
The state
currently charges 3 cents per 1,000 cubic feet of natural gas and 20
cents a
barrel for oil. “Two dimes,” Kasich has said incredulously.
Given the
richness of the Utica shale formation in Ohio, including in Stark and
Carroll
counties, drillers have plenty of incentive to stay here.
And Kasich
has plenty of incentive to push for the severance tax increase, which
GOP
legislators say they may study by the end of the year. It’s part of a
great
plan, which he pitched this way to state legislators (who promptly
removed it
from his midbudget review bill): “Every cent — 100 percent — of new tax
revenue
from the high-volume horizontal wells like those used in Ohio’s Utica
and
Marcellus shale formations will be used to reduce income taxes the
following
year. Each of Ohio’s nine tax brackets will be reduced to ensure that
taxpayers
of every income level receive a tax cut.”
What’s not
to like? Anyone?
Read this
and other articles at the Canton Repository
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