HB 288: "An Act relating to the minimum tax imposed on oil and gas produced from leases or properties that include land north of 68 degrees North latitude; and providing for an effective date."
00 HOUSE BILL NO. 288 01 "An Act relating to the minimum tax imposed on oil and gas produced from leases or 02 properties that include land north of 68 degrees North latitude; and providing for an 03 effective date." 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 (e) of this section for 07 (1) oil and gas produced before January 1, 2019 [JANUARY 1, 08 2022], from leases or properties that include land north of 68 degrees North latitude, 09 other than gas subject to (o) of this section, may not be less than 10 (A) four percent of the gross value at the point of production 11 when the average price per barrel for Alaska North Slope crude oil for sale on 12 the United States West Coast during the calendar year for which the tax is due 13 is more than $25; 14 (B) three percent of the gross value at the point of production
01 when the average price per barrel for Alaska North Slope crude oil for sale on 02 the United States West Coast during the calendar year for which the tax is due 03 is over $20 but not over $25; 04 (C) two percent of the gross value at the point of production 05 when the average price per barrel for Alaska North Slope crude oil for sale on 06 the United States West Coast during the calendar year for which the tax is due 07 is over $17.50 but not over $20; 08 (D) one percent of the gross value at the point of production 09 when the average price per barrel for Alaska North Slope crude oil for sale on 10 the United States West Coast during the calendar year for which the tax is due 11 is over $15 but not over $17.50; or 12 (E) zero percent of the gross value at the point of production 13 when the average price per barrel for Alaska North Slope crude oil for sale on 14 the United States West Coast during the calendar year for which the tax is due 15 is $15 or less; [AND] 16 (2) oil and gas produced on and after January 1, 2019, and before 17 January 1, 2022, from leases or properties that include land north of 68 degrees 18 North latitude, other than gas subject to (o) of this section, may not be less than 19 (A) seven percent of the gross value at the point of 20 production when the average price per barrel for Alaska North Slope 21 crude oil for sale on the United States West Coast during the calendar 22 year for which the tax is due is more than $25; 23 (B) three percent of the gross value at the point of 24 production when the average price per barrel for Alaska North Slope 25 crude oil for sale on the United States West Coast during the calendar 26 year for which the tax is due is over $20 but not over $25; 27 (C) two percent of the gross value at the point of production 28 when the average price per barrel for Alaska North Slope crude oil for 29 sale on the United States West Coast during the calendar year for which 30 the tax is due is over $17.50 but not over $20; 31 (D) one percent of the gross value at the point of production
01 when the average price per barrel for Alaska North Slope crude oil for 02 sale on the United States West Coast during the calendar year for which 03 the tax is due is over $15 but not over $17.50; or 04 (E) zero percent of the gross value at the point of production 05 when the average price per barrel for Alaska North Slope crude oil for 06 sale on the United States West Coast during the calendar year for which 07 the tax is due is $15 or less; and 08 (3) oil produced on and after January 1, 2022, from leases or properties 09 that include land north of 68 degrees North latitude, may not be less than 10 (A) seven [FOUR] percent of the gross value at the point of 11 production when the average price per barrel for Alaska North Slope crude oil 12 for sale on the United States West Coast during the calendar year for which the 13 tax is due is more than $25; 14 (B) three percent of the gross value at the point of production 15 when the average price per barrel for Alaska North Slope crude oil for sale on 16 the United States West Coast during the calendar year for which the tax is due 17 is over $20 but not over $25; 18 (C) two percent of the gross value at the point of production 19 when the average price per barrel for Alaska North Slope crude oil for sale on 20 the United States West Coast during the calendar year for which the tax is due 21 is over $17.50 but not over $20; 22 (D) one percent of the gross value at the point of production 23 when the average price per barrel for Alaska North Slope crude oil for sale on 24 the United States West Coast during the calendar year for which the tax is due 25 is over $15 but not over $17.50; or 26 (E) zero percent of the gross value at the point of production 27 when the average price per barrel for Alaska North Slope crude oil for sale on 28 the United States West Coast during the calendar year for which the tax is due 29 is $15 or less. 30 * Sec. 2. AS 43.55.020(a) is amended to read: 31 (a) For a calendar year, a producer subject to tax under AS 43.55.011 shall pay
01 the tax as follows: 02 (1) for oil and gas produced before January 1, 2014, an installment 03 payment of the estimated tax levied by AS 43.55.011(e), net of any tax credits applied 04 as allowed by law, is due for each month of the calendar year on the last day of the 05 following month; except as otherwise provided under (2) of this subsection, the 06 amount of the installment payment is the sum of the following amounts, less 1/12 of 07 the tax credits that are allowed by law to be applied against the tax levied by 08 AS 43.55.011(e) for the calendar year, but the amount of the installment payment may 09 not be less than zero: 10 (A) for oil and gas not subject to AS 43.55.011(o) or (p) 11 produced from leases or properties in the state outside the Cook Inlet 12 sedimentary basin, other than leases or properties subject to AS 43.55.011(f), 13 the greater of 14 (i) zero; or 15 (ii) the sum of 25 percent and the tax rate calculated for 16 the month under AS 43.55.011(g) multiplied by the remainder obtained 17 by subtracting 1/12 of the producer's adjusted lease expenditures for the 18 calendar year of production under AS 43.55.165 and 43.55.170 that are 19 deductible for the oil and gas under AS 43.55.160 from the gross value 20 at the point of production of the oil and gas produced from the leases or 21 properties during the month for which the installment payment is 22 calculated; 23 (B) for oil and gas produced from leases or properties subject 24 to AS 43.55.011(f), the greatest of 25 (i) zero; 26 (ii) zero percent, one percent, two percent, three 27 percent, or four percent, as applicable, of the gross value at the point of 28 production of the oil and gas produced from the leases or properties 29 during the month for which the installment payment is calculated; or 30 (iii) 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 those leases 05 or properties during the month for which the installment payment is 06 calculated; 07 (C) for oil or gas subject to AS 43.55.011(j), (k), or (o), for 08 each lease or property, the greater of 09 (i) zero; or 10 (ii) the sum of 25 percent and the tax rate calculated for 11 the month under AS 43.55.011(g) multiplied by the remainder obtained 12 by subtracting 1/12 of the producer's adjusted lease expenditures for the 13 calendar year of production under AS 43.55.165 and 43.55.170 that are 14 deductible under AS 43.55.160 for the oil or gas, respectively, 15 produced from the lease or property from the gross value at the point of 16 production of the oil or gas, respectively, produced from the lease or 17 property during the month for which the installment payment is 18 calculated; 19 (D) for oil and gas subject to AS 43.55.011(p), the lesser of 20 (i) the sum of 25 percent and the tax rate calculated for 21 the month under AS 43.55.011(g) multiplied by the remainder obtained 22 by 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, but not less than zero; or 28 (ii) four percent of the gross value at the point of 29 production of the oil and gas produced from the leases or properties 30 during the month, but not less than zero; 31 (2) an amount calculated under (1)(C) of this subsection for oil or gas
01 subject to AS 43.55.011(j), (k), or (o) may not exceed the product obtained by 02 carrying out the calculation set out in AS 43.55.011(j)(1) or (2) or 43.55.011(o), as 03 applicable, for gas or set out in AS 43.55.011(k) for oil, but substituting in 04 AS 43.55.011(j)(1)(A) or (2)(A) or 43.55.011(o), as applicable, the amount of taxable 05 gas produced during the month for the amount of taxable gas produced during the 06 calendar year and substituting in AS 43.55.011(k) the amount of taxable oil produced 07 during the month for the amount of taxable oil produced during the calendar year; 08 (3) an installment payment of the estimated tax levied by 09 AS 43.55.011(i) for each lease or property is due for each month of the calendar year 10 on the last day of the following month; the amount of the installment payment is the 11 sum of 12 (A) the applicable tax rate for oil provided under 13 AS 43.55.011(i), multiplied by the gross value at the point of production of the 14 oil taxable under AS 43.55.011(i) and produced from the lease or property 15 during the month; and 16 (B) the applicable tax rate for gas provided under 17 AS 43.55.011(i), multiplied by the gross value at the point of production of the 18 gas taxable under AS 43.55.011(i) and produced from the lease or property 19 during the month; 20 (4) any amount of tax levied by AS 43.55.011, net of any credits 21 applied as allowed by law, that exceeds the total of the amounts due as installment 22 payments of estimated tax is due on March 31 of the year following the calendar year 23 of production; 24 (5) for oil and gas produced on and after January 1, 2014, and before 25 January 1, 2022, an installment payment of the estimated tax levied by 26 AS 43.55.011(e), net of any tax credits applied as allowed by law, is due for each 27 month of the calendar year on the last day of the following month; except as otherwise 28 provided under (6) of this subsection, the amount of the installment payment is the 29 sum of the following amounts, less 1/12 of the tax credits that are allowed by law to be 30 applied against the tax levied by AS 43.55.011(e) for the calendar year, but the amount 31 of the installment payment may not be less than zero:
01 (A) for oil and gas not subject to AS 43.55.011(o) or (p) 02 produced from leases or properties in the state outside the Cook Inlet 03 sedimentary basin, other than leases or properties subject to AS 43.55.011(f), 04 the greater of 05 (i) zero; or 06 (ii) 35 percent multiplied by the remainder obtained by 07 subtracting 1/12 of the producer's adjusted lease expenditures for the 08 calendar year of production under AS 43.55.165 and 43.55.170 that are 09 deductible for the oil and gas under AS 43.55.160 from the gross value 10 at the point of production of the oil and gas produced from the leases or 11 properties during the month for which the installment payment is 12 calculated; 13 (B) for oil and gas produced from leases or properties subject 14 to AS 43.55.011(f), the greatest of 15 (i) zero; 16 (ii) the percentage applicable under AS 43.55.011(f) 17 [ZERO PERCENT, ONE PERCENT, TWO PERCENT, THREE 18 PERCENT, OR FOUR PERCENT, AS APPLICABLE,] of the gross 19 value at the point of production of the oil and gas produced from the 20 leases or properties during the month for which the installment 21 payment is calculated; or 22 (iii) 35 percent multiplied by the remainder obtained by 23 subtracting 1/12 of the producer's adjusted lease expenditures for the 24 calendar year of production under AS 43.55.165 and 43.55.170 that are 25 deductible for the oil and gas under AS 43.55.160 from the gross value 26 at the point of production of the oil and gas produced from those leases 27 or properties during the month for which the installment payment is 28 calculated, except that, for the purposes of this calculation, a reduction 29 from the gross value at the point of production may apply for oil and 30 gas subject to AS 43.55.160(f) or (g); 31 (C) for oil or gas subject to AS 43.55.011(j), (k), or (o), for
01 each lease or property, the greater of 02 (i) zero; or 03 (ii) 35 percent multiplied by the remainder obtained by 04 subtracting 1/12 of the producer's adjusted lease expenditures for the 05 calendar year of production under AS 43.55.165 and 43.55.170 that are 06 deductible under AS 43.55.160 for the oil or gas, respectively, 07 produced from the lease or property from the gross value at the point of 08 production of the oil or gas, respectively, produced from the lease or 09 property during the month for which the installment payment is 10 calculated; 11 (D) for oil and gas subject to AS 43.55.011(p), the lesser of 12 (i) 35 percent multiplied by the remainder obtained by 13 subtracting 1/12 of the producer's adjusted lease expenditures for the 14 calendar year of production under AS 43.55.165 and 43.55.170 that are 15 deductible for the oil and gas under AS 43.55.160 from the gross value 16 at the point of production of the oil and gas produced from the leases or 17 properties during the month for which the installment payment is 18 calculated, but not less than zero; or 19 (ii) four percent of the gross value at the point of 20 production of the oil and gas produced from the leases or properties 21 during the month, but not less than zero; 22 (6) an amount calculated under (5)(C) of this subsection for oil or gas 23 subject to AS 43.55.011(j), (k), or (o) may not exceed the product obtained by 24 carrying out the calculation set out in AS 43.55.011(j)(1) or (2) or 43.55.011(o), as 25 applicable, for gas or set out in AS 43.55.011(k) for oil, but substituting in 26 AS 43.55.011(j)(1)(A) or (2)(A) or 43.55.011(o), as applicable, the amount of taxable 27 gas produced during the month for the amount of taxable gas produced during the 28 calendar year and substituting in AS 43.55.011(k) the amount of taxable oil produced 29 during the month for the amount of taxable oil produced during the calendar year; 30 (7) for oil and gas produced on or after January 1, 2022, an installment 31 payment of the estimated tax levied by AS 43.55.011(e), net of any tax credits applied
01 as allowed by law, is due for each month of the calendar year on the last day of the 02 following month; except as otherwise provided under (10) of this subsection, the 03 amount of the installment payment is the sum of the following amounts, less 1/12 of 04 the tax credits that are allowed by law to be applied against the tax levied by 05 AS 43.55.011(e) for the calendar year, but the amount of the installment payment may 06 not be less than zero: 07 (A) for oil produced from leases or properties subject to 08 AS 43.55.011(f), the greatest of 09 (i) zero; 10 (ii) the percentage applicable under AS 43.55.011(f) 11 [ZERO PERCENT, ONE PERCENT, TWO PERCENT, THREE 12 PERCENT, OR FOUR PERCENT, AS APPLICABLE,] of the gross 13 value at the point of production of the oil produced from the leases or 14 properties during the month for which the installment payment is 15 calculated; or 16 (iii) 35 percent multiplied by the remainder obtained by 17 subtracting 1/12 of the producer's adjusted lease expenditures for the 18 calendar year of production under AS 43.55.165 and 43.55.170 that are 19 deductible for the oil under AS 43.55.160(h)(1) from the gross value at 20 the point of production of the oil produced from those leases or 21 properties during the month for which the installment payment is 22 calculated, except that, for the purposes of this calculation, a reduction 23 from the gross value at the point of production may apply for oil 24 subject to AS 43.55.160(f) or 43.55.160(f) and (g); 25 (B) for oil produced before or during the last calendar year 26 under AS 43.55.024(b) for which the producer could take a tax credit under 27 AS 43.55.024(a), from leases or properties in the state outside the Cook Inlet 28 sedimentary basin, no part of which is north of 68 degrees North latitude, other 29 than leases or properties subject to AS 43.55.011(o) or (p), the greater of 30 (i) zero; or 31 (ii) 35 percent multiplied by the remainder obtained by
01 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 under AS 43.55.160(h)(2) from the gross value at 04 the point of production of the oil produced from the leases or properties 05 during the month for which the installment payment is calculated; 06 (C) for oil and gas produced from leases or properties subject 07 to AS 43.55.011(p), except as otherwise provided under (8) of this subsection, 08 the sum of 09 (i) 35 percent multiplied by the remainder obtained by 10 subtracting 1/12 of the producer's adjusted lease expenditures for the 11 calendar year of production under AS 43.55.165 and 43.55.170 that are 12 deductible for the oil under AS 43.55.160(h)(3) from the gross value at 13 the point of production of the oil produced from the leases or properties 14 during the month for which the installment payment is calculated, but 15 not less than zero; and 16 (ii) 13 percent of the gross value at the point of 17 production of the gas produced from the leases or properties during the 18 month, but not less than zero; 19 (D) for oil produced from leases or properties in the state, no 20 part of which is north of 68 degrees North latitude, other than leases or 21 properties subject to (B), (C), or (F) of this paragraph, the greater of 22 (i) zero; or 23 (ii) 35 percent multiplied by the remainder obtained by 24 subtracting 1/12 of the producer's adjusted lease expenditures for the 25 calendar year of production under AS 43.55.165 and 43.55.170 that are 26 deductible for the oil under AS 43.55.160(h)(4) from the gross value at 27 the point of production of the oil produced from the leases or properties 28 during the month for which the installment payment is calculated; 29 (E) for gas produced from each lease or property in the state 30 outside the Cook Inlet sedimentary basin, other than a lease or property subject 31 to AS 43.55.011(o) or (p), 13 percent of the gross value at the point of
01 production of the gas produced from the lease or property during the month for 02 which the installment payment is calculated, but not less than zero; 03 (F) for oil subject to AS 43.55.011(k), for each lease or 04 property, the greater of 05 (i) zero; or 06 (ii) 35 percent multiplied by the remainder obtained by 07 subtracting 1/12 of the producer's adjusted lease expenditures for the 08 calendar year of production under AS 43.55.165 and 43.55.170 that are 09 deductible under AS 43.55.160 for the oil produced from the lease or 10 property from the gross value at the point of production of the oil 11 produced from the lease or property during the month for which the 12 installment payment is calculated; 13 (G) for gas subject to AS 43.55.011(j) or (o), for each lease or 14 property, the greater of 15 (i) zero; or 16 (ii) 13 percent of the gross value at the point of 17 production of the gas produced from the lease or property during the 18 month for which the installment payment is calculated; 19 (8) an amount calculated under (7)(C) of this subsection may not 20 exceed four percent of the gross value at the point of production of the oil and gas 21 produced from leases or properties subject to AS 43.55.011(p) during the month for 22 which the installment payment is calculated; 23 (9) for purposes of the calculation under (1)(B)(ii), (5)(B)(ii), and 24 (7)(A)(ii) of this subsection, the applicable percentage of the gross value at the point 25 of production is determined under AS 43.55.011(f) [AS 43.55.011(f)(1) OR (2)] but 26 substituting the phrase "month for which the installment payment is calculated" in 27 AS 43.55.011(f) [AS 43.55.011(f)(1) AND (2)] for the phrase "calendar year for 28 which the tax is due"; 29 (10) an amount calculated under (7)(F) or (G) of this subsection for oil 30 or gas subject to AS 43.55.011(j), (k), or (o) may not exceed the product obtained by 31 carrying out the calculation set out in AS 43.55.011(j)(1) or (2) or 43.55.011(o), as
01 applicable, for gas, or set out in AS 43.55.011(k) for oil, but substituting in 02 AS 43.55.011(j)(1)(A) or (2)(A) or 43.55.011(o), as applicable, the amount of taxable 03 gas produced during the month for the amount of taxable gas produced during the 04 calendar year and substituting in AS 43.55.011(k) the amount of taxable oil produced 05 during the month for the amount of taxable oil produced during the calendar year. 06 (10) an amount calculated under (7)(F) or (G) of this subsection for oil 07 or gas subject to AS 43.55.011(j), (k), or (o) may not exceed the product obtained by 08 carrying out the calculation set out in AS 43.55.011(j)(1) or (2) or 43.55.011(o), as 09 applicable, for gas, or set out in AS 43.55.011(k) for oil, but substituting in 10 AS 43.55.011(j)(1)(A) or (2)(A) or 43.55.011(o), as applicable, the amount of taxable 11 gas produced during the month for the amount of taxable gas produced during the 12 calendar year and substituting in AS 43.55.011(k) the amount of taxable oil produced 13 during the month for the amount of taxable oil produced during the calendar year. 14 * Sec. 3. This Act takes effect January 1, 2019.