Mineral Revenues in Louisiana
Status Report Submitted to Senate Committee on Revenue and Fiscal Affairs and House Committee on Ways and Means of the Louisiana Legislature
Dr. James A. Richardson, LSU Public Administration Institute
Dr. Greg Upton, LSU Center for Energy Studies
In the 2018 second extraordinary session, Senate Concurrent Resolution 4 was passed asking Dr. Jim Richardson and Dr. Greg Upton to make specific recommendations to the legislature regarding mineral taxes in Louisiana. The motivation for this request was based on work conducted by the Task Force on Structural Change in Budget & Tax Policy and a recently published book chapter on the topic. SCR 4 can be found here.
The economists were asked to explore possible changes to Louisiana mineral tax structure and consider the following goals:
- Preserve or improve the competitiveness of the oil and gas extraction sector in Louisiana.
- Decrease or remove the difference in tax rates for oil and gas.
- Create an equitable system of severance tax exemptions on all wells, not just horizontal wells.
- Hold constant or increase mineral revenues for the state.
- Explore other reasons why oil and gas production is fluctuating in the state of Louisiana and any changes that need to be made to increase production.
This document serves as the preliminary status report highlighting the work conducted in the first year of a three-year study process.