Oil profit tax debate

[Steve McDaniel]

WASHINGTON — With gasoline prices topping $4 a gallon, Senate Democrats want the government to grab some of the billions of dollars in profits being taken in by the major oil companies.

Senators were to vote today on whether to consider a windfall profits tax against the five largest U.S. oil companies and rescind $17 billion in tax breaks the companies expect to enjoy over the next decade.

“The oil companies need to know that there is a limit on how much profit they can take in this economy,” said Sen. Richard Durbin of Illinois, the Senate’s No. 2 Democrat, warning that if energy prices are not reined in “we’re going to find ourselves in a deep recession.”

But the Democrats are going to have to overcome staunch Republican opposition to any new taxes on the oil industry. The five largest U.S. oil companies earned $36 billion during the first three months of the year.

Read full article here

What a sham! No matter what happens we are going to be stuck paying more and more for gas, and the government is going to do less and less to promote better, more efficient cars!

[lamebums]

I disagree with the tax breaks the oil companies have but there's no reason why we should go do the opposite and stick them with a windfall tax. They only make about seven cents on the dollar, it's the huge dollar amount of gas sold that drives up their profits. Taxing them will just send prices higher--or they will stop selling altogether and cause rationing and gas lines.

[Wilson]

Taxing them on windfall profits will not do anything as they will just pass it off onto the consumers and we will be paying even more at the pump - gotta keep the profits for the shareholders! Slowly phasing out some of the tax breaks they get and offering new ones for developing alternatives to gasoline is the way to go in my opinion.

[kmactavi]

I think that us paying (slightly) more at the pump due to tax could be a good thing, it would force most consumers to start driving less, and it would force auto manufacturers to focus completely on fuel efficient cars, and the tax collected (either windfall or increased fuel tax) could go towards that research. This of course will drive up prices of food, anything imported, etc, but if it is only a few cents more per gallon, it could be really beneficial.


Kirk

[Dauvis]

Personally, I don't see price of gas going higher being that bad of a thing. Sure, it make me mad to pay as much as what they are charging but the only way to get people to change is to hit them in the pocketbook. I don't have much sympathy for Detroit because these so called more efficient cars coming from them are marginally better than the SL2 that I had bought in 99. I almost a decade, MPG from the big 3 has increased at most a few MPG and that's because of the changing sentiment of the consumer. Frankly, I've probably bought the last American made car I'll every buy unless they get their act together and stop producing inefficient junk.

If Congress should do anything, they should take those tax breaks that big oil gets and give them to companies that research and produce alternate energy sources and more fuel efficient vehicles. Also, a public education program to encourage slower and less aggressive driving might help.

[BailOut]

Here's an interesting companion to this story. It follows the oil money and the voting records on this issue:

Avg Oil/Gas Money Per Vote

Yea (48) $54,948
Nay (36) $159,288


http://priceofoil.org/2008/06/10/an-...in-the-senate/

[lamebums]

Originally Posted by BailOut

Here's an interesting companion to this story. It follows the oil money and the voting records on this issue:

Avg Oil/Gas Money Per Vote

Yea (48) $54,948
Nay (36) $159,288


http://priceofoil.org/2008/06/10/an-...in-the-senate/

I'm not surprised. But nearly $55,000 isn't chump change either.

If I had it my way I'd lock all the congressmen and senators in a room together with no communication from the outside world until they really solved some serious issues. No special interests, no lobbyists, no campaign money, nothing. Just fix the damned problems the country has already.

[MutinousDoug]

Originally Posted by Steve McDaniel

Read full article here

What a sham! No matter what happens we are going to be stuck paying more and more for gas, and the government is going to do less and less to promote better, more efficient cars!

Had Congress not blocked development of ANWR in 1994 we would have 1,000,000 bbls/day of additional oil in the US market today, affecting gas prices by $0.70 to $1.30/gallon. Shell oil has spent multiple Millions of $ developing oil shale the congress just voted a moritorium on exploiting.
Congress is directly responsible for a large portion of gas price rise and has done nothing to encourage efficiency in the market or industry (cars/refineries/production). Now Federal subsidised urban mass transit systems are showing themselves to be a hollow shell; unable to respond to increased ridership or fuel costs.
Everything Congress touches turns to cr@p on a dinner plate.

[kayasbluetaco]

They can avoid the windfall tax by investing the monies over a certain profit into clean energy. This wouldn't (as far as I can see it) affect them passing a charge onto us, because it would just increase their profit again to get taxed again.

It's a better idea than what the republicans are putting forward at this point, which as far as I can see is nothing. Hell, Bush is so out of touch he was shocked when he heard there were rumors gas would hit $4.00 He said something along the lines "well, I haven't heard such a thing" Talk about out of touch.

I don't agree with the dems on everything, or most things fiscally related, but this one, I think they have something with... personally...

[Devinator]

I think it's a good idea. Correct me if I'm wrong, but I think the purpose of those huge tax breaks that Oil Companies enjoy were supposed to encourage investment in more refineries and cleaner alternatives. The problem is they haven't invested that much into either. Instead they have been using the lion's share of those huge profits to benefit their shareholders by buying back stock. Hey you can't blame them on that, it's their responsibility to look after their shareholders. You can blame the legislators though for failing to anticipate that when they gave them the tax breaks.

This new legislation does encourage investment though by saying if you invest in cleaner alternatives and increased refinery capacity you will avoid the windfall profits tax. The taxes the government does collect will be used to fund renewable energy projects.

Steve McDaniel you are right. No matter what there is nothing anyone can do to give us cheap gas forever, but at least this plan is a first step toward getting us off of the stuff.