Incidence of an American oil-severance tax under world pricing by OPEC: a note

Journal Article · Tue Jul 01 04:00:00 EDT 1980 · Nat. Resour. J.; (United States)

OSTI ID:7074888

McDonald, S L

When an oil-severance tax is imposed by a single state, there is an elastic demand curve that requires landowners in the state to bear part of the tax burden and consumers of all the states to bear the rest. If the US is the sole country to impose a severance tax and, if decontrolled domestic oil cannot exceed world prices, the landowners receiving rents (lease bonus plus royalty) will bear the burden when marginal costs rise above world prices. In the long run, the tax burden also falls on the landowner under the control of Organization of Petroleum Exporting Countries (OPEC) pricing. Other states will balance the severance tax with a differential tax without affecting price. (DCK)

• Research Organization: Univ. of Texas, Austin
• OSTI ID: 7074888
• Journal Information: Nat. Resour. J.; (United States), Journal Name: Nat. Resour. J.; (United States) Vol. 20:3; ISSN NRJOA
• Country of Publication: United States
• Language: English

Related Subjects

02 PETROLEUM
020700 -- Petroleum-- Economics
Industrial
& Business Aspects
29 ENERGY PLANNING, POLICY, AND ECONOMY
293000 -- Energy Planning & Policy-- Policy
Legislation
& Regulation
294002* -- Energy Planning & Policy-- Petroleum
ENERGY SOURCES
FOSSIL FUELS
FUELS
INTERNATIONAL ORGANIZATIONS
MARKET
OIL-EXPORTING COUNTRIES
OPEC
PETROLEUM
PRICES
TAXES