Lee County is rich in Natural Beauty and Natural Resources. Along with Agriculture, Mining has long been a major economic driver for Southwest Virginia.
Prior to beginning mining operations in Lee County, Virginia, every operator shall file with the Commissioner of the Revenue an application for a license for each mining operation.
The Code of Virginia allows the governing body of any county or city the right to levy a license tax on every person engaging in the business of severing coal, oil or gases from the earth.
Lee County has a Severance Tax established by the Board of Supervisors in the Severance Ordinance. The ordinance is based on the Code of Virginia and all reporting is with the Commissioner’s office.
The rates are currently 1½% (<10,000 ton) or 2% (>10,000 ton) of the gross monthly receipts for coal - depending on the amount of tonnage sold, ½% for oil and 3% for gas. Lee County License is to be applied for monthly.
The license and tax is to be paid by the 20th of each month on the gross receipts of the preceding month. Should a company fail to file and pay the tax to Lee County, the Commissioner may shut the operation down until the company is in compliance with the tax ordinance.
The Division of Mines, Minerals, and Energy requires coal-mining companies to file a Lee County Coal Severance Affidavit by February 15 of each year.