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Notice of Extended Filing and Payment Deadline for Alaska Corporate Income Tax


Oil Conservation Surcharges
Historical Overview





AS 43.55.201/300
DESCRIPTION
Conservation surcharges apply to all oil production in Alaska and are in addition to oil and gas production taxes. Surcharges apply to each barrel of oil produced in the state less any oil the ownership or right to which is exempt from taxation.

RATE AND DISPOSITION OF REVENUE
Each taxable barrel (“bbl”) of oil is subject to the following two surcharges:

1) Conservation Surcharge (AS 43.55.201) of $0.01 per barrel. Revenue derived from this surcharge may be appropriated to the response account in the oil and hazardous substance release prevention and response fund. The surcharge is suspended when the balance of the fund is over $50 million per AS 43.55.221.

2) Additional Conservation Surcharge (AS 43.55.300) or $0.04 per barrel. Revenue derived from this additional surcharge may be appropriated to the oil and hazardous substance release prevention account in the oil and hazardous substance release prevention and response fund.

HISTORY

1989 - Following the grounding of the Exxon Valdez, this tax was enacted in order to provide a hazardous substance release emergency fund. A $0.05/bbl hazardous release surcharge is imposed on oil production until the newly created hazardous substance release fund achieves a balance of $50 million.

1994 - The hazardous release surcharge is modified to the so-called “split nickel” with an ongoing charge of $0.03/bbl and an additional charge of $0.02/bbl whenever the hazardous substance release fund balance falls below $50 million.

2006 - The legislature set the Conservation Surcharge rate at $0.01/bbl and the Additional Conservation Surcharge rate at $0.04/bbl.

FY 2015 STATISTICS*
*The Oil Conservation Surcharge is reported on the same return and by the same taxpayers as is Alaska’s, Oil and Gas Production Tax (AS 43.55). The Division has not segregated program cost and staffing related to each individual tax. The Division reports the total production tax cost and staffing in the Oil and Gas Production Tax section.