Shortey: Keep current tax rate on oil and gas industry

Sen. Ralph Shortey today said any potential increase in tax rates on horizontal drilling would have an adverse effect on the energy industry, and economic growth in Oklahoma.

A tax incentive establishing a one percent tax on horizontal wells is set to expire in 2015, and would rise to seven percent if allowed to sunset. Shortey said that if lawmakers are truly committed to creating a more pro-growth environment in Oklahoma, they must continue working to eliminate barriers to development like higher taxes and excessive regulation.

“America’s new energy revolution has been made possible in large part by horizontal drilling techniques pioneered by Oklahoma energy companies,” said Shortey, R-Oklahoma City. “An increase in the tax rate on horizontal drilling would actively discourage energy companies from drilling wells and furthering their most important technology. Energy is the bedrock of the state’s economy, and if we burden the industry with higher taxes, we will adversely impact economic development and job growth in Oklahoma.”

Shortey said that if legislative leaders choose to pursue an increase in the tax rate, the policy would have a ripple effect through the Oklahoma economy.

“This is an incentive that provides meaningful tax relief for Oklahoma businesses, enabling them to sustain and create new jobs,” Shortey said. “I am committed to doing everything I can to keep the current tax rate, and I hope my fellow lawmakers join me in opposition to this potential tax increase. At a time when state government should be doing everything it can to encourage growth, a tax increase is simply unacceptable.”