The oil and gas industry is a cornerstone of America’s economy, contributing billions of dollars annually in taxes, royalties, and fees. These revenues fuel local, state, and federal programs while supporting infrastructure, education, and public services that benefit all Americans.

The oil and gas sector is subject to multiple layers of taxation, reflecting its vital role in the economy:

• Billions Annually: The oil and gas industry contributes billions in taxes, royalties, and other revenues to governments at all levels.
• Corporate Income Taxes: The industry pays some of the highest effective corporate tax rates in the U.S., contributing billions annually.
• Severance Taxes: Many states impose severance taxes on oil and gas extraction, generating critical funding for local governments.
• Property Taxes: Oil and gas companies are among the largest property taxpayers in many energy-producing states.
• Sales and Use Taxes: Equipment, services, and operations related to oil and gas production generate significant sales tax revenue.

The industry also contributes through lease payments and royalties on production from federal, state, and private lands:

• Sharing the Benefits: Nearly half of federal revenue from energy production is distributed to states, providing vital resources for local communities.

Intangible Drilling Costs (IDCs): Fueling Investment and Local Impact

Learn more about Intangible Drilling Costs (IDCs): Fueling Investment and Local Impact here.