Tax break urged for troubled Texas oil producers
AUSTIN, Texas, Jan 14 (Reuters) - The Texas Railroad Commission urged the state legislature on Wednesday to provide tax relief to the state's beleaguered oil and gas producers.
The three-member panel, which regulates the Texas oil industry, called on legislators to back a proposal to suspend state taxes on production whenever oil prices fell below $15 per barrel and gas prices fell below $1.50 per thousand cubic feet.
Oil prices have been at 12 year lows for the past few months and, in inflation adjusted terms, are at their lowest level for a quarter century.
''Today, with the oil price per barrel where it is, there is simply no way the domestic energy industry, in particular the independents in our state, can stay competitive with foreign oil,'' Commissioner Tony Garza said in a statement.
The Railroad Commission said the oil and gas industry pumped nearly $60 billion into the Texas economy in 1997, provided more than 1.2 million jobs directly and indirectly in the state and was an important source of funding for schools and universities.
Currently Texas levies a 4.6 percent tax on the wellhead value of oil and a 7.5 percent tax on the wellhead value of gas.
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