What is the severance tax rate for oil and condensate?

The severance oil and condensate tax rates are as follows:

Full Rate : 12.5 percent of value
Incapable Rate : 6.25 percent of value
Stripper Rate : 3.125 percent of value
  :  
Half Rate – Inactive Oil : 6.25 percent of value
Quarter Rate – Orphan Oil : 3.125 percent of value
  :  
Reclaimed Oil : 3.125 percent of value
  :  
Horizontal Rate :  
7/22 through 6/23 : 5.0 percent of value
7/23 through 6/24 : 5.0 percent of value

Stripper oil is exempt for any taxable period during which the average taxable value is less than $20 per barrel per LA R.S. 47:633(7)(c)(i)(bb).

LA R.S. 47:633(7)(d)(i) provides that the Secretary shall determine the oil price upon which the exemption for a horizontal well that produces oil be based on July First of each year for the ensuing twelve months based upon the average New York Mercantile Exchange Price per barrel of crude oil per month on the close of business June Thirtieth for the prior twelve months. The amount of the exemption for a horizontal well that produces oil shall be as follows:

• The exemption shall be 100% if the price of oil is at or below $70 per barrel.
• The exemption shall be 80% if the price of oil is above $70 and at or below $80 per barrel.
• The exemption shall be 60% if the price of oil is above $80 and at or below $90 per barrel.
• The exemption shall be 40% if the price of oil is above $90 and at or below $100 per barrel.
• The exemption shall be 20% if the price of oil is above $100 and at or below $110 per barrel.
• There shall be no exemption in effect if the price of oil exceeds $110 per barrel.

LA R.S. 47:633(7)(a) provides that the taxable value of oil shall be the higher of (1) the gross receipts received from the first purchaser, less charges for trucking, barging and pipeline fees, or (2) the posted field price. In the absence of an arms-length transaction or posted field price, the value shall be the severer’s gross income from the property as determined by LA R.S. 47:158(C).

LA R.S. 47:633(8) provides that the tax rate for distillate, condensate, or similar natural resources severed from the soil or water either with oil or gas is 12.5 percent of its gross value at the time and place of severance.