Coal Gross Proceeds Tax

Overview

All coal mines must file a Coal Gross Proceeds Tax return.

Tax Rate

Montana taxes coal gross proceeds at 5% per year. (15-23-703, MCA)

Formula:

Tax Owed = Tax Value × 0.050

Determining Gross Proceeds

Gross proceeds are the number of tons produced multiplied by the contract sales price. The contract sales price is the price of the coal extracted and prepared for shipment FOB Mine, minus the required production taxes.

Formula:

Gross Proceeds = Price FOB Mine – Production Taxes + Royalties

Production Taxes

Production taxes include:

  • State severance tax
  • Resource Indemnity Trust and Ground Water Assessment Tax
  • Local gross proceeds tax
  • Federal reclamation taxes
  • Federal Black Lung tax

Royalties

The contract sales price includes up to $0.15 per ton royalties paid to federal, state, and tribal governments and all royalties paid to other mineral rights owners.

Reporting and Payment Options

Due Dates

The Coal Gross Proceeds Tax is due in two payments:

  • 50% of taxes due November 30
  • 50% of taxes due May 31 (the following year)

Local county treasurers collect CGP Tax. Contact your county for more information.

Revenue Distribution

County treasurers distribute portions of CGP revenue to the appropriate taxing jurisdiction based on the number of mills levied in fiscal year 1990.

Related Laws