SB 192: "An Act relating to the minimum production tax on oil and gas; and relating to the tax credit applicable to each barrel of certain oil produced north of 68 degrees North latitude."
00 SENATE BILL NO. 192 01 "An Act relating to the minimum production tax on oil and gas; and relating to the tax 02 credit applicable to each barrel of certain oil produced north of 68 degrees North 03 latitude." 04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 05 * Section 1. AS 43.55.011(f) is amended to read: 06 (f) The levy of tax under this section for oil and gas produced north of 68 07 degrees North latitude, other than oil and gas production subject to (i) of this section 08 and gas subject to (o) of this section, may not be less than 09 (1) four percent of the gross value at the point of production for oil 10 and gas produced before January 1, 2015, and 15 percent of the gross value at the 11 point of production for oil and gas produced after December 31, 2014, when the 12 average price per barrel for Alaska North Slope crude oil for sale on the United States 13 West Coast during the calendar year for which the tax is due is more than $25; 14 (2) three percent of the gross value at the point of production when the
01 average price per barrel for Alaska North Slope crude oil for sale on the United States 02 West Coast during the calendar year for which the tax is due is over $20 but not over 03 $25; 04 (3) two percent of the gross value at the point of production when the 05 average price per barrel for Alaska North Slope crude oil for sale on the United States 06 West Coast during the calendar year for which the tax is due is over $17.50 but not 07 over $20; 08 (4) one percent of the gross value at the point of production when the 09 average price per barrel for Alaska North Slope crude oil for sale on the United States 10 West Coast during the calendar year for which the tax is due is over $15 but not over 11 $17.50; or 12 (5) zero percent of the gross value at the point of production when the 13 average price per barrel for Alaska North Slope crude oil for sale on the United States 14 West Coast during the calendar year for which the tax is due is $15 or less. 15 * Sec. 2. AS 43.55.020(a) is amended to read: 16 (a) For a calendar year, a producer subject to tax under AS 43.55.011 shall pay 17 the tax as follows: 18 (1) before January 1, 2014, an installment payment of the estimated tax 19 levied by AS 43.55.011(e), net of any tax credits applied as allowed by law, is due for 20 each month of the calendar year on the last day of the following month; except as 21 otherwise provided under (2) of this subsection, the amount of the installment payment 22 is the sum of the following amounts, less 1/12 of the tax credits that are allowed by 23 law to be applied against the tax levied by AS 43.55.011(e) for the calendar year, but 24 the amount of the installment payment may not be less than zero: 25 (A) for oil and gas not subject to AS 43.55.011(o) or (p) 26 produced from leases or properties in the state outside the Cook Inlet 27 sedimentary basin, other than leases or properties subject to AS 43.55.011(f), 28 the greater of 29 (i) zero; or 30 (ii) the sum of 25 percent and the tax rate calculated for 31 the month under AS 43.55.011(g) multiplied by the remainder obtained
01 by subtracting 1/12 of the producer's adjusted lease expenditures for the 02 calendar year of production under AS 43.55.165 and 43.55.170 that are 03 deductible for the oil and gas under AS 43.55.160 from the gross value 04 at the point of production of the oil and gas produced from the leases or 05 properties during the month for which the installment payment is 06 calculated; 07 (B) for oil and gas produced from leases or properties subject 08 to AS 43.55.011(f), the greatest of 09 (i) zero; 10 (ii) zero percent, one percent, two percent, three 11 percent, or four percent, as applicable, of the gross value at the point of 12 production of the oil and gas produced from the leases or properties 13 during the month for which the installment payment is calculated; or 14 (iii) the sum of 25 percent and the tax rate calculated for 15 the month under AS 43.55.011(g) multiplied by the remainder obtained 16 by subtracting 1/12 of the producer's adjusted lease expenditures for the 17 calendar year of production under AS 43.55.165 and 43.55.170 that are 18 deductible for the oil and gas under AS 43.55.160 from the gross value 19 at the point of production of the oil and gas produced from those leases 20 or properties during the month for which the installment payment is 21 calculated; 22 (C) for oil or gas subject to AS 43.55.011(j), (k), or (o), for 23 each lease or property, the greater of 24 (i) zero; or 25 (ii) the sum of 25 percent and the tax rate calculated for 26 the month under AS 43.55.011(g) multiplied by the remainder obtained 27 by subtracting 1/12 of the producer's adjusted lease expenditures for the 28 calendar year of production under AS 43.55.165 and 43.55.170 that are 29 deductible under AS 43.55.160 for the oil or gas, respectively, 30 produced from the lease or property from the gross value at the point of 31 production of the oil or gas, respectively, produced from the lease or
01 property during the month for which the installment payment is 02 calculated; 03 (D) for oil and gas subject to AS 43.55.011(p), the lesser of 04 (i) the sum of 25 percent and the tax rate calculated for 05 the month under AS 43.55.011(g) multiplied by the remainder obtained 06 by subtracting 1/12 of the producer's adjusted lease expenditures for the 07 calendar year of production under AS 43.55.165 and 43.55.170 that are 08 deductible for the oil and gas under AS 43.55.160 from the gross value 09 at the point of production of the oil and gas produced from the leases or 10 properties during the month for which the installment payment is 11 calculated, but not less than zero; or 12 (ii) four percent of the gross value at the point of 13 production of the oil and gas produced from the leases or properties 14 during the month, but not less than zero; 15 (2) an amount calculated under (1)(C) of this subsection for oil or gas 16 subject to AS 43.55.011(j), (k), or (o) may not exceed the product obtained by 17 carrying out the calculation set out in AS 43.55.011(j)(1) or (2) or 43.55.011(o), as 18 applicable, for gas or set out in AS 43.55.011(k)(1) or (2), as applicable, for oil, but 19 substituting in AS 43.55.011(j)(1)(A) or (2)(A) or 43.55.011(o), as applicable, the 20 amount of taxable gas produced during the month for the amount of taxable gas 21 produced during the calendar year and substituting in AS 43.55.011(k)(1)(A) or 22 (2)(A), as applicable, the amount of taxable oil produced during the month for the 23 amount of taxable oil produced during the calendar year; 24 (3) an installment payment of the estimated tax levied by 25 AS 43.55.011(i) for each lease or property is due for each month of the calendar year 26 on the last day of the following month; the amount of the installment payment is the 27 sum of 28 (A) the applicable tax rate for oil provided under 29 AS 43.55.011(i), multiplied by the gross value at the point of production of the 30 oil taxable under AS 43.55.011(i) and produced from the lease or property 31 during the month; and
01 (B) the applicable tax rate for gas provided under 02 AS 43.55.011(i), multiplied by the gross value at the point of production of the 03 gas taxable under AS 43.55.011(i) and produced from the lease or property 04 during the month; 05 (4) any amount of tax levied by AS 43.55.011, net of any credits 06 applied as allowed by law, that exceeds the total of the amounts due as installment 07 payments of estimated tax is due on March 31 of the year following the calendar year 08 of production; 09 (5) on and after January 1, 2014, an installment payment of the 10 estimated tax levied by AS 43.55.011(e), net of any tax credits applied as allowed by 11 law, is due for each month of the calendar year on the last day of the following month; 12 except as otherwise provided under (6) of this subsection, the amount of the 13 installment payment is the sum of the following amounts, less 1/12 of the tax credits 14 that are allowed by law to be applied against the tax levied by AS 43.55.011(e) for the 15 calendar year, but the amount of the installment payment may not be less than zero: 16 (A) for oil and gas not subject to AS 43.55.011(o) or (p) 17 produced from leases or properties in the state outside the Cook Inlet 18 sedimentary basin, other than leases or properties subject to AS 43.55.011(f), 19 the greater of 20 (i) zero; or 21 (ii) 35 percent multiplied by the remainder obtained by 22 subtracting 1/12 of the producer's adjusted lease expenditures for the 23 calendar year of production under AS 43.55.165 and 43.55.170 that are 24 deductible for the oil and gas under AS 43.55.160 from the gross value 25 at the point of production of the oil and gas produced from the leases or 26 properties during the month for which the installment payment is 27 calculated; 28 (B) for oil and gas produced from leases or properties subject 29 to AS 43.55.011(f), the greatest of 30 (i) zero; 31 (ii) zero percent, one percent, two percent, three
01 percent, [OR] four percent, or 15 percent, as applicable, of the gross 02 value at the point of production of the oil and gas produced from the 03 leases or properties during the month for which the installment 04 payment is calculated; or 05 (iii) 35 percent multiplied by the remainder obtained by 06 subtracting 1/12 of the producer's adjusted lease expenditures for the 07 calendar year of production under AS 43.55.165 and 43.55.170 that are 08 deductible for the oil and gas under AS 43.55.160 from the gross value 09 at the point of production of the oil and gas produced from those leases 10 or properties during the month for which the installment payment is 11 calculated, except that, for the purposes of this calculation, a reduction 12 from the gross value at the point of production may apply for oil and 13 gas subject to AS 43.55.160(f) or (g); 14 (C) for oil or gas subject to AS 43.55.011(j), (k), or (o), for 15 each lease or property, the greater of 16 (i) zero; or 17 (ii) 35 percent multiplied by the remainder obtained by 18 subtracting 1/12 of the producer's adjusted lease expenditures for the 19 calendar year of production under AS 43.55.165 and 43.55.170 that are 20 deductible under AS 43.55.160 for the oil or gas, respectively, 21 produced from the lease or property from the gross value at the point of 22 production of the oil or gas, respectively, produced from the lease or 23 property during the month for which the installment payment is 24 calculated; 25 (D) for oil and gas subject to AS 43.55.011(p), the lesser of 26 (i) 35 percent multiplied by the remainder obtained by 27 subtracting 1/12 of the producer's adjusted lease expenditures for the 28 calendar year of production under AS 43.55.165 and 43.55.170 that are 29 deductible for the oil and gas under AS 43.55.160 from the gross value 30 at the point of production of the oil and gas produced from the leases or 31 properties during the month for which the installment payment is
01 calculated, but not less than zero; or 02 (ii) four percent of the gross value at the point of 03 production of the oil and gas produced from the leases or properties 04 during the month, but not less than zero; 05 (6) an amount calculated under (5)(C) of this subsection for oil or gas 06 subject to AS 43.55.011(j), (k), or (o) may not exceed the product obtained by 07 carrying out the calculation set out in AS 43.55.011(j)(1) or (2) or 43.55.011(o), as 08 applicable, for gas or set out in AS 43.55.011(k)(1) or (2), as applicable, for oil, but 09 substituting in AS 43.55.011(j)(1)(A) or (2)(A) or 43.55.011(o), as applicable, the 10 amount of taxable gas produced during the month for the amount of taxable gas 11 produced during the calendar year and substituting in AS 43.55.011(k)(1)(A) or 12 (2)(A), as applicable, the amount of taxable oil produced during the month for the 13 amount of taxable oil produced during the calendar year. 14 * Sec. 3. AS 43.55.024(j) is amended to read: 15 (j) A producer may apply against the producer's tax liability for the calendar 16 year under AS 43.55.011(e) a tax credit in the amount specified in this subsection for 17 each barrel of oil taxable under AS 43.55.011(e) that does not meet any of the criteria 18 in AS 43.55.160(f) or (g) and that is produced during a calendar year [AFTER 19 DECEMBER 31, 2013,] from leases or properties north of 68 degrees North latitude. 20 A tax credit under this subsection may not reduce a producer's tax liability for a 21 calendar year under AS 43.55.011(e) below the amount calculated under 22 AS 43.55.011(f). The amount of the tax credit for a barrel of taxable oil subject to this 23 subsection produced during a month of 24 (1) the calendar year 2014 is 25 (A) [(1)] $8 for each barrel of taxable oil if the average gross 26 value at the point of production for the month is less than $80 a barrel; 27 (B) [(2)] $7 for each barrel of taxable oil if the average gross 28 value at the point of production for the month is greater than or equal to $80 a 29 barrel, but less than $90 a barrel; 30 (C) [(3)] $6 for each barrel of taxable oil if the average gross 31 value at the point of production for the month is greater than or equal to $90 a
01 barrel, but less than $100 a barrel; 02 (D) [(4)] $5 for each barrel of taxable oil if the average gross 03 value at the point of production for the month is greater than or equal to $100 a 04 barrel, but less than $110 a barrel; 05 (E) [(5)] $4 for each barrel of taxable oil if the average gross 06 value at the point of production for the month is greater than or equal to $110 a 07 barrel, but less than $120 a barrel; 08 (F) [(6)] $3 for each barrel of taxable oil if the average gross 09 value at the point of production for the month is greater than or equal to $120 a 10 barrel, but less than $130 a barrel; 11 (G) [(7)] $2 for each barrel of taxable oil if the average gross 12 value at the point of production for the month is greater than or equal to $130 a 13 barrel, but less than $140 a barrel; 14 (H) [(8)] $1 for each barrel of taxable oil if the average gross 15 value at the point of production for the month is greater than or equal to $140 a 16 barrel, but less than $150 a barrel; 17 (I) [(9)] zero if the average gross value at the point of 18 production for the month is greater than or equal to $150 a barrel; 19 (2) a calendar year after 2014 is 20 (A) $4 for each barrel of taxable oil if the average gross 21 value at the point of production for the month is less than $80 a barrel; 22 (B) $3.50 for each barrel of taxable oil if the average gross 23 value at the point of production for the month is greater than or equal to 24 $80 a barrel, but less than $90 a barrel; 25 (C) $3 for each barrel of taxable oil if the average gross 26 value at the point of production for the month is greater than or equal to 27 $90 a barrel, but less than $100 a barrel; 28 (D) $2.50 for each barrel of taxable oil if the average gross 29 value at the point of production for the month is greater than or equal to 30 $100 a barrel, but less than $110 a barrel; 31 (E) $2 for each barrel of taxable oil if the average gross
01 value at the point of production for the month is greater than or equal to 02 $110 a barrel, but less than $120 a barrel; 03 (F) $1.50 for each barrel of taxable oil if the average gross 04 value at the point of production for the month is greater than or equal to 05 $120 a barrel, but less than $130 a barrel; 06 (G) $1 for each barrel of taxable oil if the average gross 07 value at the point of production for the month is greater than or equal to 08 $130 a barrel, but less than $140 a barrel; 09 (H) $0.50 for each barrel of taxable oil if the average gross 10 value at the point of production for the month is greater than or equal to 11 $140 a barrel, but less than $150 a barrel; 12 (I) zero if the average gross value at the point of production 13 for the month is greater than or equal to $150 a barrel.