Table 5--Years of enactment of special forest tax 
laws employed by the various Southern States, as 
of January 1, 1986 
State 
Alabama 
Arkansas 
Florida 
Georgia 
Louisiana 
Mississippi 
N. Carolina 
Oklahoma 
S. Carolina 
Tennessee 
Texas 
Virginia 
1939 
1973 
Exemption Laws--Three States--Alabama, North 
Carolina, and Tennessee--currently have exemption 
laws. All of these statutes are mandatory, and each 
applies to essentially all standing timber. Because 
the laws are mandatory, theydo not set forth any 
eligibility requirements or application procedures. In 
addition, there are no penalties prescribed for with- 
drawal from the program. 
Yield Tax Laws--Yield tax laws are presently being 
employed in Alabama, Louisiana, and Mississippi. 
Mississippi's law is known as a severance tax but 
has been classified as a yield tax because it is levied 
in place of, not in addition to, the normal property 
tax on timber (Forest Industries Committee on Tim- 
ber Valuation and Taxation 1984). 
The programs of Louisiana and Mississippi are 
mandatory and accordingly do not set forth any 
eligibility requirements or application procedures. In 
contrast, Alabama's program is optional and limits 
participation to landowners who are willing to keep 
their land in timber production and protect it from 
fire for 5 years. 
Type of special forest tax 
Yield 
1923 
1954 
1940 
Modi- 
fied 
assess- 
ment 
Sever- 
ance 
1945 
1923 
Alabama's is the only law containing special 
provisions relating to the tax treatment of enrolled 
lands. These provisions stipulate that properties of 
160 acres or less are to be exempted from any land 
tax. Tracts exceeding this size are to be taxed on the 
basis of a fixed assessment established at the time 
of enrollment. 
All of the statutes defer any timber taxes until 
the time of harvesst. Tax rates, however, are vari- 
able. Alabama taxes all products at 8 percent of 
their stumpage value. Louisiana uses a rate of 5 
percent for pulpwood-sized material and 2.25 per- 
cent for everything else. Finally, Mississippi, follow- 
ing the pattern of a severance tax, imposes a fixed 
levy per unit volume or per unit of product. The 
amount of this levy varies with the type of product 
being cut. 
Alabama's yield tax, consistent with its optional 
nature, is the only program to provide for a declassi- 
fication penalty. This penalty equals 8 percent of the 
value of the timber on a tract at the time of withdraw- 
al. 
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