SB 247 Utah Senate · 2025 General Session

Severance Tax Revenue Amendments

SB 247 amends severance tax rates for oil and gas extraction revenue, directly affecting companies generating such revenue in the state. It increases the tax rate on the first $50 million of annual revenue from 2.5% to 3.5%, raises the rate on the next $50 million from 1% to 1.5%, and reduces the rate on revenue above $100 million from 1% to 0.5%. The bill establishes a tiered tax structure based on annual revenue levels, aiming to adjust tax collection from the oil and gas sector. This policy change modifies how severance taxes are calculated without altering the tax base or exemption rules.

Issues: ✓ Budget & Taxes

Bill status in committee 1 of 4 stages cleared

Introduction

Feb 2025

Committee Review

Floor Vote

Governor

Introduced Feb 10, 2025 Last action Mar 8, 2025

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What changed between versions

Amended Excerpts 2/14/2025 10:02:997 → Amended 2/14/2025 10:02:997 · 6 edits

MODERATE

This bill amends Utah's severance tax revenue distribution rules, primarily increasing the percentage of revenue allocated to the Utah Geological Survey Restricted Account and adjusting percentages for other state accounts. The changes affect how much money from oil, gas, and mining taxes is distributed to various state agencies starting July 1, 2025.

Scope change

The bill applies to fiscal years beginning on or after July 1, 2025, modifying the distribution percentages for severance tax revenue across multiple state accounts.

FISCAL

Increased the percentage of severance tax revenue allocated to the Utah Geological Survey Restricted Account from 3.5% to 5% for the first $50 million, 1.5% to 1.5% for the next $50 million, and added a new 0.5% tier for revenue exceeding $100 million.

Adjusted the Division of Air Quality Oil, Gas, and Mining Restricted Account distribution percentages from 2.5%/1%/0.5% to 2.75%/1%/0.5%.

Adjusted the Division of Water Quality Oil, Gas, and Mining Restricted Account distribution percentages from 2.5%/1%/0.5% to 0.4%/0.15%/0.08%.

Modified the Division of Oil, Gas, and Mining Restricted Account distribution percentages, changing mining revenue allocation from 2.5%/1%/0.5% to 11.5%/3%/1% and oil and gas revenue allocation from 2.5%/1%/0.5% to 18%/3%/1%.

DEFINITION

Added new definitions for 'Average aggregate annual revenue', 'Average aggregate annual mining revenue', 'Average aggregate annual oil and gas revenue', and 'Aggregate annual mining revenue' and 'Aggregate annual oil and gas revenue' to clarify calculation methods.

TIMELINE

Changed the effective date for new distribution rules from July 1, 2021 to July 1, 2025.

Floor votes

How they voted

No floor votes recorded yet.

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Amendments

Feb 14, 2025

Upper · Passed

Senate/ comm rpt/ amended/ placed on Consent Cal

upper

Feb 14, 2025

Upper · Passed

Senate Comm - Favorable Recommendation

upper

Feb 14, 2025

Introduced

Senate Comm - Amendment Recommendation

upper

Feb 11, 2025

Committee

Senate/ to standing committee

upper

Feb 10, 2025

Introduced

Senate/ 1st reading (Introduced)

upper

1 primary · 0 co-sponsors