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| No. 14 |
SEVERANCE TAX |
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The removal of metals,
petroleum, coal, phosphate, and other non-renewable resources from the
earth poses many environmental, social, and conservation
problems. A new mining operation brings problems of housing,
schooling, community services, roads, etc. when it enters a small
town. Similarly, the closing of a mining operation requires the
relocation of miners (or their retraining) loss of revenue, and other
readjustments. |
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| Although the Federation of
Western Outdoor Clubs does not advocate the exploitation of natural
resources, it does have concern over the environmental and conservation
results of the recovery operations. Money to cover the publicly
responsible costs of the mining areas is difficult to obtain from
property taxes. The logical method of obtaining money for mining
related costs is by imposing a severance tax on the products of the
mine. |
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| Severance taxes are legal,
practical, and successfully used in many states, notable Montana,
Alaska, Colorado, Wyoming, New Mexico, and Texas. Since severance
taxes are essentially a sales tax on mine products, the purchasers of
the mine products pay the taxes, not the mining company, local
citizens, ore even citizens of the state. The great majority of
most mine products are shipped out of state, even out of the
U.S.A. Routine operations of protecting the environment in the
course of mining are the responsibility of the mining company and not
covered by the severance tax. |
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| Therefore, the Federation
of
Western Outdoor Clubs supports the concept of severance taxes in
connection with mineral developments of any kind. |
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