(a) The tax imposed by this chapter is at the rate of 4.6 percent of the market value of oil produced in this state or 4.6 cents for each barrel of 42 standard gallons of oil produced in this state, whichever rate results in the greater amount of tax.
(b) For oil produced in this state from a new or expanded enhanced recovery project that qualifies under § 202.054 of this code, the rate of the tax imposed by this chapter is 2.3 percent of the market value of the oil.

Terms Used In Texas Tax Code 202.052

  • Market value: means the price at which a property would transfer for cash or its equivalent under prevailing market conditions if:
    (A) exposed for sale in the open market with a reasonable time for the seller to find a purchaser;
    (B) both the seller and the purchaser know of all the uses and purposes to which the property is adapted and for which it is capable of being used and of the enforceable restrictions on its use; and
    (C) both the seller and purchaser seek to maximize their gains and neither is in a position to take advantage of the exigencies of the other. See Texas Tax Code 1.04

(c) The exemptions described by Sections 202.056, 202.059, and 202.060 apply to oil produced in this state from a well that qualifies under § 202.056, 202.059, or 202.060, subject to the certifications and approvals required by those sections.

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