About The Tax

  • The Michigan Severance Tax Act, MCL 205.301, levies a tax on oil and gas severed from the soil in Michigan. Producers or purchasers are required to report the oil and gas production, and the value, in a monthly return. Michigan severance tax returns must be filed monthly, by the 25th of the month following the production. Returns not filed timely are subject to the late filing penalty and interest provisions of the Michigan Revenue Act, MCL 205.1 et seq

2020 Current Year Fee

Oil & Gas Fee

  • 2019 1.00 % of gross cash market value
    2018 1.00 % of gross cash market value
    2017 1.00 % of gross cash market value
    2016 1.00 % of gross cash market value

    Tax Rates

    Oil Oil Condensate 6.6% of gross cash market value
    Marginal/Stripper Oil Well Oil Condensate 4% of gross cash market value
    Gas Gas
    Natural Gas Liquids
    5% of gross cash market value

Related Resources

Severance Tax Related Revenue Administrative Bulletins (RABs)

  • RAB Number Title
    1989-13 Native Gas
    1989-14 Filing Severance Tax Returns
    1989-16 Liability of Common Purchaser
    1989-17 Liability – Audit Deficiencies
    1989-19 Notice to Common Purchaser of Marketing Deductions for Use in Determining Wellhead Value for Severance Tax Computations
    1989-20 Lease Use Gas Taxability
    1992-5 Marketing Costs
    1992-6 Severance Taxation of Gas Used in Gas Injection
    1992-8 Lower Severance Tax Rate on Marginal and Stripper Oil and Liquid Phase Condensate Production
    1992-9 Allowable Marketing Cost Deductions to Severance Tax