Severance tax

Resources that typically incur severance taxes when extracted include oil, natural gas, coal, uranium, and timber.

Note that severance taxes are used in jurisdictions where most resource extraction occurs on privately owned land and/or where sub-surface minerals are privately owned (for example, the United States).

[3] States usually calculate the tax based on the value and/or volume produced; sometimes the method differs for oil, natural gas, and condensates.

[5] As of 2021, 34 states collect a severance tax on oil and gas extraction.

[6] As of September 2022, the Colorado severance tax was 1% of the gross income from oil and gas owed.