Ashton Marra Published

Bill Would Cut Both Coal and Natural Gas Severance Tax Rates


During a session that has largely focused on how lawmakers will close a nearly $400 million budget gap, the Senate will vote on a bill Wednesday that will cut taxes for both the coal and natural gas industries. 

Both industries are set to benefit from a bill signed by Governor Tomblin this week. That bill ends a special severance tax on coal and natural gas that was implemented to pay off West Virginia’s Worker’s Compensation Debt.

Late in the session, members of the Senate Finance Committee presented another bill to the chamber that would cut the standard coal severance tax by 2 percent over the next two fiscal years.

The end result would be a severance tax of 3 percent by July 1, 2018, which is estimated to cost the state more than $100 million in revenues.

Tuesday, members of the Senate amended the bill to include a cut in the severance tax on natural gas as well.

Sponsors say both industries are hurting and the tax breaks could help prevent further job losses.

The state is facing a $466 million revenue shortfall in the 2017 budget.