Signed by Governor Sean Parnell

Vote Smart's Synopsis:

Vote to concur with House amendments and pass a bill that increases the production tax on oil and gas and authorizes new tax credits for oil and gas producers, effective January 1, 2014.

Highlights:

• Increases the annual production tax on oil and gas from 25 percent to 35 percent, beginning January 1, 2014 (Sec. 4).

• Authorizes a carried-forward tax credit for the exploration, development or production of oil and gas deposits in the following amounts (Sec. 15):
• 45 percent for lease expenditures incurred between January 1, 2014, and January 1, 2016, for deposits north of 68 degrees North latitude;
• 35 percent for lease expenditures incurred after January 1, 2016, for deposits north of 68 degrees North latitude; and
• 25 percent for lease expenditures incurred after January 1, 2014 for deposits south of 68 degrees North latitude.

• Authorizes a tax credit of $5 per barrel of oil produced after December 1, 2013 (Sec. 21).

• Authorizes a tax credit on oil produced from properties north of 68 degrees North latitude after December 31, 2013, at the following rates (Sec. 21):
• $8 per barrel when the monthly average is less than $80 per barrel of oil;
• $7 per barrel when the monthly average is between $80 and $90 per barrel of oil;
• $6 per barrel when the monthly average is between $90 and $100 per barrel of oil;
• $5 per barrel when the monthly average is between $100 and $110 per barrel of oil;
• $4 per barrel when the monthly average is between $110 and $120 per barrel of oil;
• $3 per barrel when the monthly average is between $120 and $130 per barrel of oil;
• $2 per barrel when the monthly average is between $130 and $140 per barrel of oil;
• $1 per barrel when the monthly average is between $140 and $150 per barrel of oil; and 
• $0 per barrel when the monthly average is greater than or equal to $150 per barrel of oil.

• Establishes an oil and gas service industry expenditure credit for expenses incurred in the state of either 10 percent or $10 million, whichever is less, beginning the tax year after December 31, 2013 (Sec. 3).

• Establishes the Oil and Gas Competitiveness Review Board to review the competitive position of Alaska in the oil and gas sector, identify factors that affect investment in oil and gas, and recommend changes to increase investment (Sec. 31).

Full Bill Text

Vote Smart's Synopsis:

Vote to pass a bill that increases the production tax on oil and gas and authorizes new tax credits for oil and gas producers, effective January 1, 2014.

Highlights:

• Increases the annual production tax on oil and gas from 25 percent to 35 percent, beginning January 1, 2014 (Sec. 4).

• Authorizes a carried-forward tax credit for the exploration, development or production of oil and gas deposits in the following amounts (Sec. 15):
• 45 percent for lease expenditures incurred between January 1, 2014, and January 1, 2016, for deposits north of 68 degrees North latitude;
• 35 percent for lease expenditures incurred after January 1, 2016, for deposits north of 68 degrees North latitude; and
• 25 percent for lease expenditures incurred after January 1, 2014 for deposits south of 68 degrees North latitude.

• Authorizes a tax credit of $5 per barrel of oil produced after December 1, 2013 (Sec. 21).

• Authorizes a tax credit on oil produced from properties north of 68 degrees North latitude after December 31, 2013, at the following rates (Sec. 21):
• $8 per barrel when the monthly average is less than $80 per barrel of oil;
• $7 per barrel when the monthly average is between $80 and $90 per barrel of oil;
• $6 per barrel when the monthly average is between $90 and $100 per barrel of oil;
• $5 per barrel when the monthly average is between $100 and $110 per barrel of oil;
• $4 per barrel when the monthly average is between $110 and $120 per barrel of oil;
• $3 per barrel when the monthly average is between $120 and $130 per barrel of oil;
• $2 per barrel when the monthly average is between $130 and $140 per barrel of oil;
• $1 per barrel when the monthly average is between $140 and $150 per barrel of oil; and 
• $0 per barrel when the monthly average is greater than or equal to $150 per barrel of oil.

• Establishes an oil and gas service industry expenditure credit for expenses incurred in the state of either 10 percent or $10 million, whichever is less, beginning the tax year after December 31, 2013 (Sec. 3).

• Establishes the Oil and Gas Competitiveness Review Board to review the competitive position of Alaska in the oil and gas sector, identify factors that affect investment in oil and gas, and recommend changes to increase investment (Sec. 31).

Full Bill Text

Vote Smart's Synopsis:

Vote to pass a bill that increases the production tax on oil and gas and authorizes new tax credits for oil and gas producers, effective January 1, 2014.

Highlights:

• Increases the annual production tax on oil and gas from 25 percent to 35 percent, beginning January 1, 2014 (Sec. 4).

• Authorizes a carried-forward tax credit for the exploration, development or production of oil and gas deposits in the following amounts (Sec. 15):
• 45 percent for lease expenditures incurred between January 1, 2014, and January 1, 2016, for deposits north of 68 degrees North latitude;
• 35 percent for lease expenditures incurred after January 1, 2016, for deposits north of 68 degrees North latitude; and
• 25 percent for lease expenditures incurred after January 1, 2014 for deposits south of 68 degrees North latitude.

• Authorizes a tax credit of $5 per barrel of oil produced after December 1, 2013 (Sec. 21).

• Authorizes a tax credit on oil produced from properties north of 68 degrees North latitude after December 31, 2013, at the following rates (Sec. 21):
• $8 per barrel when the monthly average is less than $80 per barrel of oil;
• $7 per barrel when the monthly average is between $80 and $90 per barrel of oil;
• $6 per barrel when the monthly average is between $90 and $100 per barrel of oil;
• $5 per barrel when the monthly average is between $100 and $110 per barrel of oil;
• $4 per barrel when the monthly average is between $110 and $120 per barrel of oil;
• $3 per barrel when the monthly average is between $120 and $130 per barrel of oil;
• $2 per barrel when the monthly average is between $130 and $140 per barrel of oil;
• $1 per barrel when the monthly average is between $140 and $150 per barrel of oil; and 
• $0 per barrel when the monthly average is greater than or equal to $150 per barrel of oil.

• Establishes an oil and gas service industry expenditure credit for expenses incurred in the state of either 10 percent or $10 million, whichever is less, beginning the tax year after December 31, 2013 (Sec. 3).

• Establishes the Oil and Gas Competitiveness Review Board to review the competitive position of Alaska in the oil and gas sector, identify factors that affect investment in oil and gas, and recommend changes to increase investment (Sec. 31).

Full Bill Text

Vote Smart's Synopsis:

Vote to pass a bill that restructures tax rates for companies producing oil and gas within the state.

Highlights:

• Increases the annual production tax on oil and gas from 25 percent to 35 percent (Secs. 9 & 12).

• Authorizes a producer or explorer to receive a tax credit for a qualified capital expenditures incurred in the exploration, development or production of oil or gas located north of 68 degrees North latitude for expenditures incurred before January 1, 2014 (Sec. 15).

• Authorizes a producer or explorer to receive a carried-forward tax credit for the exploration, development, or production of oil and gas deposits in the following amounts (Sec. 16):
• 25 percent for lease expenditures incurred south of 68 degrees North latitude; and
• 35 percent for lease expenditures incurred north of 68 degrees North latitude after December 31, 2013.

• Authorizes a tax credit of $5 per barrel of oil produced (Sec. 21).

• Expands the installment payment rates on oil and gas production in the Cook Inlet sedimentary basin to all oil and gas produced in the state (Sec. 11). 

• Establishes the Oil and Gas Competitiveness Review Board to review the competitive position of Alaska in the oil and gas sector, identify factors that affect investment in oil and gas, and recommend changes to increase investment (Sec. 33).