Senate Democrats Schedule Vote On Massive Energy Tax Hike For Monday
Even as President Obama tries to evade the fact that his energy market meddling has lead to higher energy prices, his party is scheduling a vote on raising taxes on oil companies.
Because that’ll be great for gas prices, though notice that they’re doing this under the guise of ending “subsidies” for big oil. Because not taxing something is subsidizing it, I guess.
Following the votes, Senator Reid moved to proceed to Executive Calendar #337, S.2204, the Repeal Big Oil Tax Subsidies Act, and filed cloture on the motion to proceed.
Senator Reid then moved to proceed to Executive Calendar #296,S.1789, the Postal Reform bill, and filed cloture on the motion to proceed.
Senators should expect the cloture vote on the motion to proceed to the Repeal Big Oil Tax Subsidies Act at approximately 5:30pm Monday, March 26. If cloture is not invoked, the Senate would immediately proceed to vote on the motion to invoke cloture on the motion to proceed to Postal Reform.
So what exactly is being proposed here?
Double taxation, for one thing. This proposal would end the dual capacity tax credit that allows companies (not just oil companies) to reduce their US tax burden by the amount of foreign taxes they paid on revenues earned in foreign countries. Needless to say, double taxation would put American oil companies (already a very small slice of the international oil market pie when compared to government-owned foreign companies like Citgo, owned by Venezuela’s communist regime) at a competitive disadvantage.
Another “subsidy” being ended is the Section 199 manufacturing deduction. This, again, is policy that benefits far more than just the oil industry. The deduction is available to all US companies that manufacture, grow, refine, or otherwise produce including software companies and coffee growers (even Starbucks gets this deduction).
The oil industry receives the Section 199 deduction at a 6% rate, as opposed to the rest of the industries who take the deduction (fully 1/3 of all corporations operating in the US) at 9%.
The deduction is for income derived from property manufactured, produced, grown or extracted in the United States. Basically, if you make something, you can deduct 9% of its value (6% if you’re in the oil industry) from your taxes.
Obama wants to end this for the oil industry. Because it’s a “subsidy.” Which is a neat play on words. When he throws taxpayer dollars at “green energy” flops like Solyndra, it’s “investment.” When we let oil companies keep some of their own money, it’s a “subsidy.”Tags: Barack Obama, energy, Gas Prices, harry reid, oil, subsidies, Taxes