Tax and Fiscal Policy

photo: Wyoming coal train

The ESPC represents the public interest on mineral taxation issues. One day, Wyoming’s finite energy/mineral resources will be gone or no longer economically recoverable; we advocate for responsible stewardship in the form of severance tax rates that capture the value of these resources for the future. We worked to get the regressive sales tax off groceries and support targeted property tax relief. We also work to improve Wyoming’s complicated revenue distribution system and budgeting process.

Severance taxes

Mineral taxation has long been a contentious issue in Wyoming, going back to territorial days. A severance tax was discussed at the state’s constitutional convention, but was not enacted until 1969. In 1974, Wyoming voters amended the constitution to create the Permanent Wyoming Mineral Trust Fund, funded by a one and a half percent severance tax on all minerals extracted in Wyoming. Additional severance and property taxes on mineral extraction fund numerous other programs and services.

Wyoming state and local governments depend heavily on mineral tax and royalty revenues. The ESPC has continually advocated for higher severance taxes, thinking of the future when these nonrenewable resources will no longer be generating tax revenues.

In 2000, the Department of Economics and Finance at the University of Wyoming conducted a study for the Legislature to look at how raising or lowering severance taxes would affect jobs and production. The study concluded that lowering severance taxes would have only a minimal effect on jobs or production, but would have a huge effect on state revenues; similarly, severance tax increases would reap substantial tax revenues while not endangering jobs.

The ESPC joined with progressive organizations in other Western states to produce a report comparing mineral taxes imposed in each. Read the ESPC press release and the Mining Taxes in 10 States associated reports.

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