Ross and Griffin oppose raising severance tax on natural gas

CONWAY, AR – Republican Congressman Tim Griffin and Democratic Congressman Mike Ross both said raising the state’s severance tax on natural gas will cost Arkansas jobs. Both commented on the topic at a panel discussion on energy policy at the Conway Area Chamber of Commerce Monday.

“If you want more of something, tax it less. If you want less of something, tax it more,” said Griffin.

Ross said, “if we continue to increase taxes, all we’re going to do is drive natural gas production and the jobs that go with it out of this state, and that’s a stupid idea.”

Right now, wells are taxed between 1.25 and five percent of the value of the gas that’s taken from the land. Activist Sheffield Nelson says the tax should be raised to seven percent. The tax hike would pay for road improvements around the state.

“Either these people, who are making billions of dollars, are going to pay for the damage they’re doing. Or we, the citizens of Arkansas, you, I, our children, our grandchildren, will ultimately pay, there’s no other way around it,” Nelson told Fox16 in January.

Ross and Griffin though, say natural gas companies aren’t going to pay a higher tax — they’ll just take their business elsewhere.

“By raising this rate,” explained Ross, “we are essentially exporting our jobs and money to other states and increasing our energy dependency.”

Added Griffin, “this has been a blessing, a lot of the jobs that have come out of the natural gas industry, and we need to be doing things to encourage them.”

Ross told reporters his stance on the tax has nothing to do with a potential run for governor in 2014, saying he’ll decide on that race sometime next year. He has said he won’t seek re-election to congress.

Griffin is up for reelection and will face Democrat Herb Rule in November.

The Conway City Council will vote on a resolution to oppose the severance tax hike at their meeting Tuesday night, which starts at 6:30.

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