Beebe: Oil Companies "Challenged," "Warned" on Severance Taxes

HOT SPRINGS, AR - Governor Beebe says he has challenged companies exploring Arkansas' rich natural gas fields to come up with support to raise the state's severance taxes, or face a voter-led initiative in 2009 that will have his support.

Speaking yesterday at Hot Springs to the Association of Arkansas Counties, Beebe said he had warned the industry that, between now and 2009, there will be efforts to try to increase the severance tax to what is fair.

Arkansas taxes companies on the volume of gas produced, unlike most states that charge by market value.  A report earlier this year by those proposing a raise in the severance tax said Arkansas' severance tax ranks as one of the lowest in the country.

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