85 



18 



1 with any rule, regulation, or order issued under this sec- 



2 tion. 



3 (h) Exception. — No royalty shall be payable under 



4 subsection (a) with respect to minerals processed at a fa- 



5 cility by the same person or entity which extracted the 



6 minerals if an urban development action grant has been 



7 made under section 119 of the Housing and Community 



8 Development Act of 1974 with respect to any portion of 



9 such facility. 



10 (i) Effective Date. — The royalty under this sec- 



11 tion shall take effect with respect to the production of 



12 locatable minerals after the enactment of this Act, but any 



13 royalty payments attributable to production during the 



14 first 12 calendar months after the enactment of this Act 



15 shall be payable at the expiration of such 12-month period. 



16 SEC. 204. SEVERANCE TAX. 



17 (a) Severance Tax on Minerals. — Chapter 36 of 



18 the Internal Revenue Code of 1986 (relating to certain 



19 other excise taxes) is amended by adding at the end the 



20 following new subchapter: 



21 "Subchapter G — Tax on Severance of 



22 Locatable Minerals 



23 "SEC. 4500. tax on severance of locatable minerals. 



24 "(a) In General. — There is hereby imposed a tax 



25 on gross income resulting from the severance of any 



