Running on Fumes
Apparently, Congressional Democrats have drank the O'Malleynomic Kool-Aid, because they have decided to raise gas prices by taxing gas companies:
The House approved $18 billion in new taxes on the largest oil companies yesterday as Democrats cited record oil prices and rising gasoline costs in a time of economic troubles.Anybody who thinks that these prices will not be passed on to consumers is also deluding themselves. But I find it very odd that Congressional Democrats would consider legislation to raise taxes on American working and middle-class families during an already existing economic downturn...
The money collected over 10 years would provide tax breaks for wind, solar and other alternative energy sources and for energy conservation. The legislation, approved 236-182, would cost the five largest oil companies an average of $1.8 billion a year over that period, according an analysis by the House Ways and Means Committee. Those companies earned $123 billion last year.
posted by Brian Griffiths at 9:03 PM
1 Comments:
Brian-
My comments below are taken from a petroleum industry newsletter on the legislation referenced in your post.
HOUSE PASSES ENERGY TAX BILL AND BUSH PROMISES A VETO
On Wednesday the House again passed an $18.1 billion-dollar tax incentive package that encourages investment in renewable energy technologies by taxing oil and gas companies.
H.R. 5351, which passed 236-182, faces an uncertain future in the Senate, which has repeatedly failed to agree on proposals to repeal oil and gas industry deductions. The House has passed similar legislation three previous times this Congress. President Bush has also repeated his threat to veto the bill because it targets a specific industry.
The legislation would extend tax credits through December 31, 2010, for biodiesel and renewable diesel, but not ethanol. It would also extend and modify incentives for constructing renewable fuel pumps at gasoline stations through December 31, 2010. H.R. 5351 raises the infrastructure tax credit from 30 to 50 percent and increases the cap from $30,000 to $50,000. It would also provide a new 50 cents-a-gallon credit for cellulosic fuel.
Also, important, this bill would close the “splash and dash” loophole that allows biodiesel blenders and producers to create a B-99 blend, claim a one dollar per gallon credit and export the biodiesel overseas where some European governments also offer alternative fuel credits. PMAA supports this “clarification” that U.S. fuel credits be available only for fuel that is produced and used in the U.S.
Finally, the bill calls for a review of the Internal Revenue Code to identify tax provisions that have the largest effect on carbon gas emissions. Another study would examine biofuels, current production levels, projections for future production, maximum production capable, the domestic impact of a dramatic increase in production on the price of fuel, price of land, the environment, food price, expansion of refinery capacity, and the ability to convert corn ethanol plants to cellulosic and biofuel.
To pay for $13.7 billion of the bill, H.R. 5351 would repeal a manufacturing tax deduction for five major oil and gas companies, and change how energy companies’ foreign earnings are taxed. However, the bill would allow Citgo Petroleum Corp., a Venezuelan oil company, to retain the tax benefit that would be stripped from the U.S. companies. Citgo would continue to receive a six percent deduction for domestic manufacturing that the largest firms would lose because Citgo does not drill for oil and gas domestically or abroad.
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