Competitive Framework for Alaska: 2012

PVM Proposal for New Production At $100 per barrel, the HB 110 for New Production is equal to a much simpler concept, which is: 25% flat PPT ⚫ 20% tax credit, plus a 2.25% severance feature. The severance tax feature is no different from the way the severance tax used to be calculated in Alaska. The severance tax is a percentage of the value of the gross production less the royalty. For instance, with a royalty of 12.5% and an oil price of $ 100, a 2.25% severance feature would be equal to: 2.25% * 87.5% * $ 100 = $ 1.96875 per barrel 76

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