The Severance Tax Section administers several tax types relating to natural resources in Alabama. Taxes are filed through My Alabama Taxes.
Coal Severance Tax
- Coal Severance Taxes are administered according to the 1971 Coal Severance Tax Title 40, Chapter 13, Article 1, Sections 1-10 and 1977 Coal and Lignite Severance Tax Title 40, Chapter 13, Article 2, Sections 30-36.
- Return and payment are due the 20th of each month for the previous month.
Coal Severance Tax Rates
|Product||Privilege Tax||Other Tax|
|Coal||$0.335 per ton||Additional tax of $0.025 for underground mining or $0.05 for surface mining|
State Administered Local Severance Taxes
|Coosa County||Sand, Clay, Silt, Loam, Dirt, Gravel, Rock, Sand-gravel, Sand-Clay||25¢ per ton||99-544|
|Coosa County||Graphite||$5 per ton||2019-231|
|Jackson County||Coal||20¢ per ton||79-349, 97-220|
|Marshall County||Coal||20¢ per ton||81-482|
- Forest Products Taxes are administered according to the Code of Alabama: Title 9, Chapter 13, Article 4, Sections 80-110.
- Return and payment are due 30 days after the end of each quarter.
Forest Products Tax Rates
|Kind of Products||Rate of Taxation|
|Pine Logs received by a concentration yard, manufacturer, or processor||$.10/ton|
|Pine Logs exported out-of-state||$.10/ton|
|Logs-All Other Species received by a concentration yard, manufacturer, or processor||$.065/ton|
|Logs-All Other Species exported out-of-state||$.065/ton|
|Pulpwood received by a concentration yard, manufacturer, or processor||$.10/ton|
|Pulpwood exported out-of-state||$.10/ton|
|Stumpwood received by a manufacturer||$.125/ton|
|Stumpwood exported out-of-state||$.125/ton|
|Poles/Pilings received by a concentration yard or manufacturer||$.205/ton|
|Poles/Pilings exported out-of-state||$.205/ton|
|Inwoods Pulpwood Chips received by a concentration yard or manufacturer||$.10/ton|
|Inwoods Pulpwood Chips exported out-of-state||$.10/ton|
There is also a privilege tax of 50% of the severance tax rates above, against manufacturers using forest products in the manufacturing process. This tax applies to manufacturers located only within this state.
Oil & Gas
Oil and gas severance tax payments and returns are due on or before the 15th day of the second month following the month of production.
Oil & Gas Production Tax Title 9, Chapter 17 Sections 25-35
|1%||Production from wells permitted from 7/01/96 thru 6/30/2002 for five years from first production.|
|1.66%||Gross proceeds from offshore production from depths greater than 8,000 feet below mean sea level.|
|2%||All other production.|
Oil & Gas Reduced Privilege Tax Title 40, Chapter 20 Article 1, Section 2(a)(8)
|2%||Wells normally qualifying for the 4% privilege tax rate and permitted from 7/01/96 thru 7/01/2002 for five years from first production|
|3%||Wells normally qualifying for the 6% privilege tax rate and permitted from 7/01/96 thru 7/01/2002 for five years from first production|
Oil & Gas Privilege Tax Title 40, Chapter 20 Article 1 & 1a, Sections 2 & 21, Respectively
|3.65%||Gross proceeds from offshore production from depths greater than 8,000 feet below mean sea level.|
|8%||All other taxable production.|
Uniform Severance Tax (Statewide except Coosa, Geneva, Lamar, Lee, and Wilcox)
- Uniform Severance Tax is administered according to Title 40, Chapter 13, Sections 50-61.
- The tax is due the 20th day of the month next succeeding the month of sale or delivery whichever occurs first.
- Natural minerals are taxed at $.10 per ton.
- All natural minerals, including sand, gravel, sandstone, granite, shale, clay, dolomite, limestone, bauxite, salt, silicon and any other mineral listed as such by the Geological Survey of Alabama that is not specifically excluded from taxation.
Penalties & Interest
- Failure to timely pay tax – 10% of tax.
- Failure to timely file return – Greater of 10% of tax or $50.00.
- Interest on underpayments or delinquencies is calculated at the current applicable rate from the day the tax is due to the date the tax is paid.