Cawley Says No To A Severance Tax
A week after Jim Cawley urged energy companies to “fight back” against drilling opponents, the Republican lieutenant governor is heeding his own advice, authoring a strong anti-severance tax op-ed in the Philadelphia Inquirer.
The new and growing natural gas industry – working to develop the Marcellus Shale – is a vibrant industry that is transforming our economy, creating jobs, and lowering the cost of energy. (The use of cleaner-burning natural gas will have the added benefit of improving our air quality.)
So why are critics of this industry so focused on creating new, punitive taxes on it?
The constant drumbeat for the imposition of a so-called severance tax is completely misguided.
Cawley, who chaired Governor Corbett’s Marcellus Shale Advisory Commission, went on to list the usual arguments against a tax: drilling companies are already paying taxes and indirectly boosting sales tax revenue; Pennsylvania’s overall tax climate is much more severe than other drilling states with severance taxes; and energy companies can and would move out of Pennsylvania if a new levy goes on the books.
The op-ed was oddly timed. Nearly every political observer in the state views a broad severance tax as a non-starter in the Republican-controlled state Capitol, and last month, Cawley’s commission gave momentum to the drive for a more limited impact fee, by endorsing the idea in its final report.
Cawley’s article came about a week after the lieutenant governor made headlines by urging drilling companies to “fight back” against concerns hydraulic fracturing will pollute drinking water. “It doesn’t happen,” he told a Philadelphia forum.
Cawley will host a live-chat about drilling over at Philly.com this afternoon. The session begins at one o’clock.