State Taxation of Natural Resources

November 2, 1936

Report Outline
Natural Resources as Source of New State
Taxation of Mines and Minerals
Taxation of Timber and Forest Resources
Special Focus

Natural Resources as Source of New State

Severance Taxes to Meet Social Security Costs

All of the 43 state legislatures meeting in regular session next year will be on the hunt for new sources of revenue. Many of them will be faced with the necessity of raising tax funds to finance newly-enacted social security measures. Some will be forced to find substitutes for expiring sales taxes, against whose renewal many of their members were pledged in the 1936 campaigns. “Under such circumstances, a number of states are likely to follow the lead of Texas, whose legislature, late in October, raised existing taxes and levied new taxes on the extraction of natural resources within the state.

To provide funds for payments of old-age pensions, taxes on oil production were raised from 2¢ to 2¾¢ a barrel, tonnage taxes on sulphur were increased from 75¢ to $1.03, and taxes on natural gas were increased from 2 per cent to 3 per cent of market value. In addition, a tax of 10¢ a ton was levied on marble, a tax of 10¢ a ton on cinnabar ore, a tax of 5¢ a ton on all other ores, and a tax of 3 per cent of the market value of carbon black. The increase in the oil tax is expected to add upwards of $3,000,000 to the revenue received from the present tax, which in 1935 amounted to more than $8,000,000.

Governor Allred of Texas, in a special message to the legislature urging a “substantial increase” in the oil tax, said he had been “reliably informed that Louisiana and Oklahoma will in all probability have to increase their tax on oil in order to meet their own pressing security problems.” Investigation by the Oklahoma Tax Commission of comparative oil taxes in Oklahoma and Texas was ordered early in October by Governor Marland. The commission's findings will be laid before the Oklahoma legislature in January. In Michigan, proposals to supplement property taxes on copper and other metal mines with tonnage taxes on mine production may be brought forward next year.

ISSUE TRACKER for Related Reports
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Jan. 16, 1998  IRS Reform
Mar. 22, 1996  Tax Reform
Apr. 06, 1990  How Fair Is the Nation's Tax Burden?
Aug. 28, 1987  Taxing Business Services
Oct. 17, 1986  Tax Reform In The States
Sep. 28, 1984  Tax Debate: 1984 Election and Beyond
Mar. 19, 1982  Tax-Exemption Controversy
May 19, 1978  Property Tax Relief
Apr. 07, 1978  Tax Shelters and Reform
Feb. 10, 1971  Property Tax Reform
Mar. 26, 1969  Tax Reform Pressures
Mar. 24, 1965  Excise Tax Cuts and the Economy
Feb. 15, 1961  Flexible Taxation
Apr. 02, 1959  State Tax Problems
Apr. 23, 1958  Tax Reduction, 1958
Aug. 14, 1957  Fast Tax Write-Offs
Apr. 10, 1957  Federal Payments in Lieu of Taxes
Sep. 12, 1956  Corporation Profits and Taxes in Prosperity
Mar. 16, 1954  Shares in Tax Relief
Nov. 21, 1953  Revision of Excise Taxes
Mar. 19, 1953  Federal-State Tax Relations
Oct. 01, 1952  European Taxes and Tax Evasion
Nov. 03, 1950  Excess Profits Tax
Feb. 01, 1950  Tax Loopholes
Jun. 04, 1949  Excise Taxes
Oct. 27, 1948  Postwar Sales Taxes
Aug. 29, 1947  Taxation of Family Income
Apr. 09, 1947  Income Tax Relief
Jan. 11, 1946  Taxation of Cooperatives
Oct. 16, 1945  Federal Taxes on Business
May 08, 1944  Postwar Taxes
Sep. 20, 1943  Sales Taxes
Dec. 05, 1941  New Taxes for Defense
Apr. 05, 1941  Taxation for National Defense
Feb. 28, 1941  Taxation of Alcoholic Beverages
Jan. 11, 1941  Exemptions from Taxation
Dec. 04, 1940  Federal Taxes and Defense Financing
Feb. 01, 1940  Sharing of Tax Revenues
Feb. 02, 1939  Turnover Taxes in the States
Nov. 05, 1937  Broadening of the Income-Tax Base
Jun. 17, 1937  Exemptions from Income Taxation
Apr. 05, 1937  Coordination of Federal and State Tax Systems
Dec. 19, 1936  Revision of Federal Tax on Capital Gains
Nov. 02, 1936  State Taxation of Natural Resources
May 26, 1936  Assessment of Property for Taxation
Apr. 17, 1936  Federal Taxes on Consumption
Mar. 19, 1936  Taxation of Undistributed Corporate Profits
Dec. 17, 1935  Reduction of Tax Burdens on Real Estate
Oct. 21, 1935  Tax Delinquency in the United States
May 21, 1935  Comparative Tax Burdens in America and Britain
Feb. 01, 1935  Federal Taxation of Corporations
Nov. 27, 1934  Elimination of Conflicts in Taxation
Jul. 25, 1933  Taxation of Excess Profits
Jan. 25, 1933  Tax Burdens and Tax-Free Securities
Nov. 23, 1932  The Beer Tax and the Sales Tax
Dec. 19, 1931  Sales Taxes: Federal, State, and Foreign
Sep. 18, 1931  Death Taxes and the Concentration of Wealth
Mar. 18, 1931  Federal Taxation of Large Incomes
Jan. 10, 1931  Taxation of Capital Gains
Nov. 09, 1929  Federal Tax Reduction-1930
Aug. 08, 1927  Federal Tax Reduction—1928
Sep. 27, 1926  Tax Reduction and the Public Debt
Jan. 16, 1926  Taxation of Estates and Inheritances
Nov. 07, 1925  Federal Taxation of Small Incomes
Nov. 28, 1924  Social, Fiscal and Legal Aspects of the Inheritance Tax
Apr. 07, 1924  Causes and Effects of the Tax Return Blockade
Dec. 12, 1923  Tax Exempt Securities
Dec. 10, 1923  Taxation
Forests and Rangelands
State, Local, and Intergovernmental Relations