State Treasurer Ken Miller spoke to reporters at a Monday press conference, which served as a year-end review of Oklahoma’s economy in 2013, and an early prediction of what the year ahead might hold.
In short: Oklahoma saw modest economic growth in 2013, and early data makes him optimistic for 2014.
Miller praised the tax contributions of Oklahoma’s oil and gas industry, which generated 9.3 percent more gross production revenue in 2013 than it did 2012.
The Treasurer also touched on a topic that could be a big debate in the upcoming legislative session: taxes on oil and gas production.
Miller said said it might be time for lawmakers to review the state’s tax break for horizontal drilling, as well as Oklahoma’s “whole oil and gas taxing policy,” The Oklahoman‘s Randy Ellis reports:
“I think that examination may show that incremental changes in the current incentive rate, in turn, may be needed, or it could reveal that comprehensive changes in energy tax policy would better provide stability for increasing global capital,” Miller said.
“It also provides opportunity for lawmakers to simplify and unify the system by lowering the gross production tax rate on all oil and gas production rather than to continue to incentivize what has become the norm.”
The overall effective gross production tax rate in Oklahoma is currently 5.5 percent for oil and 5.3 percent for natural gas, when tax incentives and everything else is considered, he said.
One alternative would be to lower the gross production tax rate from 7 percent to the effective rate oil and gas companies are actually paying, while eliminating incentives, he indicated. That would simplify the system and provide more certainty for producers, he said.