The Colorado Petroleum Association released a report Monday saying that the state’s oil and gas industry would be among the nation’s most heavily taxed if a proposed initiative doing away with a tax credit for the industry passes.
The report, by Jose Luis Alberro, of California-based LECG, says Colorado’s tax burden for oil and gas companies would be second only to Wyoming’s among the nation’s nine major energy-producing states. The report estimates what a hypothetical “average” company would pay at various prices for oil or natural gas.
“We think it’s incumbent for the association to communicate what impact the tax increase would have on companies doing business in Colorado,” said Stan Dempsey, the president of the Colorado Petroleum Association.
The initiative would eliminate a credit energy companies can deduct from their severance-tax bills after paying their local property taxes.
Earlier studies have shown Colorado with one of the lowest effective tax rates in the region for oil and gas companies. Dempsey said this study is different because it takes into account how tax amounts change as oil and gas prices rise.
George Merritt, a spokesman for the campaign backing the initiative, said the study is “funky math.”
“They’re trying to distract from the fact that Colorado gives a $300 million subsidy to oil and gas companies,” Merritt said.
John Ingold: 303-954-1068 or jingold@denverpost.com.
