severance tax
noun
: a tax levied by a state on the extractor of oil, gas, or minerals intended for consumption in other states compare royalty sense 5a
Examples of severance tax in a Sentence
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Despite lower oil and gas production, Wyoming generates more than twice the severance tax revenue.
—
Dave Young, Denver Post, 9 Dec. 2025
Legislation adopted this year will divert excess income from petroleum to the state’s severance tax permanent fund, to generate investment income and underwrite construction projects.
—Morgan Lee, Fortune, 24 Aug. 2023
The growth in state severance tax collections is not surprising, given that the tax is assessed on the sales value of the production, not as a percentage of volume as is the case in some other states.
—David Blackmon, Forbes, 10 Jan. 2023
So that would mean taxes like, uh, the commercial activity tax cigarettes and tobacco insurance policy taxes, the fracking severance tax.
—Laura Johnston, cleveland, 1 Dec. 2022
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Dave Young, Denver Post, 9 Dec. 2025
Legislation adopted this year will divert excess income from petroleum to the state’s severance tax permanent fund, to generate investment income and underwrite construction projects.
—Morgan Lee, Fortune, 24 Aug. 2023
The growth in state severance tax collections is not surprising, given that the tax is assessed on the sales value of the production, not as a percentage of volume as is the case in some other states.
—David Blackmon, Forbes, 10 Jan. 2023
So that would mean taxes like, uh, the commercial activity tax cigarettes and tobacco insurance policy taxes, the fracking severance tax.
—Laura Johnston, cleveland, 1 Dec. 2022
See All Example Sentences for severance tax
Cite this Entry
“Severance tax.” Merriam-Webster.com Dictionary, Merriam-Webster, https://www.merriam-webster.com/dictionary/severance%20tax. Accessed 31 Dec. 2025.
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