70.397 Oil and gas severance tax.

(1) Definitions. In this section:

(a) “Department" means the department of revenue.

(b) “Market value" means the sales price or market value of oil or gas at the mouth of the well, except that if the oil or gas is exchanged for something other than cash, if there is no sale between the time of severance and the due date of the tax or if the department determines that the oil or gas was not sold in an arm's length transaction, “market value" means the value determined by the department based upon a consideration of the sales price of oil or gas of similar quality.

(c) “Producer" means any person owning, controlling, managing or leasing any oil or gas property, any person who severs oil or gas from the soil or water and any person owning a royalty or other interest in oil or gas.

(2) Imposition. A severance tax is imposed upon each producer who severs oil or gas from the soil or water of this state. The amount of the tax is 7 percent of the market value of the total production of oil or gas during the previous year. If more than one producer severs oil or gas at a location, the tax imposed under this section is levied upon the producers of oil or gas in the proportion of their ownership at the time of severance but shall be paid by the person in charge of the production operation, who may deduct the amount of tax imposed upon a producer from the payments due that producer.

(3) Reports; administration.

(a) Sections 70.38 (1), 70.385 and 70.39, as they apply to the tax under s. 70.375 (2m), apply to the tax under this section. If a producer severs oil or gas from more than one location in this state, the producer shall submit a report for each location separately.

(b) Sections 71.74 (2), (9), (11), (14) and (15), 71.77, 71.78, 71.80 (6), 71.83 (1) (a) 1. and 2. and (2) (a) 2. and 3. and 71.85 (2), as they apply to the taxes under ch. 71, apply to the tax under this section.

(c) Any person feeling aggrieved by an assessment notice under this section may, within 60 days after receipt of the notice, file with the department a petition for redetermination setting forth the person's objections to the assessment. In the petition, the person may request an informal conference with representatives of the department. The secretary of revenue shall act on the petition within 90 days after receipt of the petition for redetermination. If the person is aggrieved by the secretary's denial of the petition, the person may appeal to the tax appeals commission if the appeal is filed with the commission within 30 days after the petition is denied.

(d) No petition for redetermination may be filed, acted upon or appealed unless the tax objected to is paid by the due date.

(e) The department shall administer the tax under this section.

History: 1991 a. 262.