A fracking tax proposal is halfway through the Ohio legislature. But as Statehouse correspondent Karen Kasler reports, it may be headed for trouble.
The bill puts a 2.5% severance tax on gross receipts on shale wells that are horizontally fractured, and allows drillers to deduct the commercial activity tax they pay from the severance tax they owe. It’s estimated that will bring in $316 million over five years, which would go to an income tax cut. That rate is lower than Gov. John Kasich’s proposed 2.75% tax – he says, too low.
Kasich: “Well, we’re just, we’re just way far apart on that. So that’s all I can say today.”
Kasler: “Would you veto it if this is the one?”
Kasich: “I don’t want to speculate on that. You use that word and you’re just asking for trouble. But we’re too far apart to reach agreement at this point.”
Kasich wanted to team a fracking tax increase with a hike in the cigarette tax and in the commercial activity tax to fund an income tax cut. Those last two proposals haven’t had any hearings. Meanwhile, several House lawmakers have said they expect changes in the bill in the Senate.