Jurisdictional risk assessments show extremely low levels of timber theft

The assessments indicate that hardwood producers and processors generally comply with applicable legal and regulatory requirements governing forest management, harvesting, sale, and export. Legislation at federal, state, and local levels regulates taxes and fees associated with timber management, and payment of such taxes is the norm.

All 37 assessments concluded that substantive legal frameworks exist to address timber theft and that law enforcement agencies act on reported cases. In many states, offenders have been prosecuted, demonstrating a functioning regulatory system. There was no evidence of systematic or widespread timber theft in any assessed state.

Estimated levels of illegal logging or timber theft affecting hardwood supply are well below 1% of total production. Enforcement levels are consistently high, with evidence of investigations, convictions, and penalties supporting the conclusion that governance systems are effective.

Oklahoma illustrates typical state-level oversight. The Oklahoma Department of Agriculture, Food and Forestry oversees forest management through Oklahoma Forestry Services, whose law enforcement officers investigate allegations of timber theft and forestry code violations. Public complaint mechanisms and hotlines are available.

Oklahoma statutes require timber owners to clearly mark property boundaries near harvest areas and notify adjoining landowners where boundaries are unclear. Timber theft laws address fraudulent representation of timber rights, failure to pay within specified timeframes, and other violations, with penalties classified according to the value of the timber involved.

Operators must maintain a bill of sale or contract on site during harvesting, including details of landowner, purchaser, tract identification, and materials sold, and must provide documentation to law enforcement upon request. Purchasers, including mills, are also legally required to obtain and retain bills of sale verifying legal origin.

In Texas, rising timber prices and absentee landownership have contributed to reported increases in timber theft affecting individual landowners. The Texas A&M Forest Service oversees forest management, and the Texas Timber Asset Protection Act (2023) strengthened documentation requirements to improve traceability and support enforcement.While theft incidents occur, volumes remain negligible at the industry level, and the legislation has improved investigative capacity.

In Arkansas, timber theft may involve trespass, underpayment, over harvesting, or fraudulent representation. Although unethical pricing practices toward inexperienced landowners may occur, they are not necessarily illegal. As in other states, incidents are isolated and addressed through legal channels.

Across all assessments, investigated and resolved cases of timber theft demonstrate the operation of the rule of law. While individual cases may involve significant sums, they represent a very small fraction of a multibillion-dollar industry.

The Forest Stewardship Council 2019 U.S. ControlledWood National Risk Assessment determined “Low Risk” for all indicators related to legality, including land tenure, harvesting permits, environmental requirements, trade and transport.

Taxes are routinely paid

Across all the state assessments it was found that laws associated with applicable taxes, fees, and assessments as they relate to hardwood ownership and purchase transactions are upheld. Legislation exists at the national, state, and local levels regarding taxes and other fees associated with timber management and harvest.

The 2019 FSC U.S. Controlled Wood National Risk Assessment made a Low-Risk determination for Indicators related to payment of taxes and fees in the United States. This includes indicators and assessments specifically for payment of royalties and harvesting fees, value added taxes and sales tax, and income and profit taxes, trade and transport, and transfer pricing.

Federal taxation in the U.S. is highly regulated through the Internal Revenue Service (IRS) via the Internal Revenue code. The assessments indicate no evidence of systematic avoidance of federal taxes, and there are multitudes of instances of audit and investigation by the IRS to verify correct payment.

The U.S. Forest Service and National Woodland Owners Association maintain a database for state timber and forest owner taxes with information for landowners. Numerous State University extension services offer a tax education programme for agriculture professionals and business owners (including forestland owners). These programmes provide assistance to landowners to understand tax laws, how to address a sale, and what incentives are available to landowners to reduce taxation.

The jurisdictional risk assessments indicated that there is no evidence that timberland owners, loggers, or hardwood mills regularly or systemically fail to comply with payment of taxes or other fees associated with hardwood production.