Reed Votes Against Natural Gas Tax

Reed Votes Against Natural Gas Tax
 
HARRISBURG – Rep. Dave Reed (R-Indiana) today voted against a bill approved by the state House that would enact a new tax on natural gas harvested in Pennsylvania.
 
Reed disagreed with the way the new tax revenues will be distributed. The tax is set to take effect beginning Jan. 1, 2011. Between that date and June 30, when the state fiscal year comes to an end, the tax is expected to bring in approximately $120 million. Of that money, only approximately $9 million – or 7.5 percent – will go directly to local governments with natural gas drilling sites inside their borders. The other 92.5 percent or $141 million would go to the state to control in one way or another.
 
“A greater share of the revenue should go to the communities where the natural gas is being harvested,” Reed said. “This bill unfortunately short changes the communities that will most need the funding. This proposal isn’t a fair deal.”
 
The natural gas tax, at 39 cents per thousand cubic feet, would be the highest in the nation. Pennsylvania already consistently ranks as one of the most antagonistic states toward businesses. Pennsylvania employers already pay some of the highest taxes in America through the Commonwealth’s existing corporate net income tax, capital stock and franchise tax and personal income tax.
 
“This bill combines an astronomical tax rate with an unfair revenue distribution plan,” Reed said. “This legislation certainly would not help to make Pennsylvania more economically competitive.”
 
The bill now heads to the Senate for consideration.
 
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