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Last updated 4:07PM ET
March 7, 2021
Alabama
Alabama
Governor Pushes to Double Natural Gas Well Tax
(2008-03-19)
(APR - Alabama Public Radio ) - Gov. Bob Riley is trying to build support for his bill to double the taxes paid by oil companies on their natural gas wells along the Alabama coast.

Riley said at a news conference Wednesday he can't understand why any legislator would not support the bill because oil companies could get away with paying no severance tax if Alabama doesn't change its tax system.

Riley's bill is sitting in a House committee. His bill would change Alabama's severance tax on natural gas wells along the Alabama coast from a value-based tax to a volume-based tax. And it would increase the taxes paid by oil companies from about $40 million annually to $80 million.

The bill is the result of a legal dispute Alabama is having with the oil companies over what expenses they can deduct in computing the state's value-based tax. Riley says Alabama could end up having to refund more than $100 million in taxes already collected if the state loses in court.
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