While Finally Promising To Pass A Budget, Democrats Aim Tax Hikes At Energy Industry

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Senate Democrats, who apparently think budgeting is like inaugurating presidents in that it’s only to happen every four years, have finally said they’ll pass a budget in 2013 after four years of not budgeting at all. Which the sort of had to do since Republicans are making Senate budgeting a prerequisite of a debt ceiling hike, but Democrats are saying they’ll only pass a budget that has more tax hikes.

And who would be the target of these tax hikes? The rich, naturally, but also the energy industry, one of the few bright spots in our national economy:

The proposed tax increases to be included in the Senate budget would be on the wealthy, oil and gas companies and corporations doing business overseas, Schumer said.

The increases on the wealthy, which Schumer did not spell out, would be in addition to the rate increase on income over $450,000 a year that Congress voted on at the beginning of the month during the fiscal cliff fight.

Senate Democrats tried, and failed, to raise taxes on the oil industry last year. Whether or not the Senate can pass them this year indexes directly to the number of democrats from energy-producing states who are up for re-election in 2014.

What Democrats have attacked before, the supposed “subsidies for big oil” we’re always hearing about, are a couple of deductions that are crucial for keeping US oil companies competitive in global markets.

One is the dual capacity tax credit which allows US-owned oil companies to reduce their tax burden here by the amount they pay in foreign taxes. Believe it or not, US “big oil” is actually a small slice of the global market which is mostly dominated by state-owned oil giants like Citgo (Venezuela). Expecting US oil companies to pay both foreign taxes, and domestic taxes, would put them at a serious competitive disadvantage, having to essentially pay double taxation.

Another “subsidy” Democrats have wanted ended in the past is the Section 199 manufacturing deduction. This is policy which 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.

The energy industry in America is surging. Oil production grew more in 2012 than in any other year in US history. The number of gas wells in the United States has grown almost 38% in the last decade. All of this production is creating jobs, spurring commerce and driving energy prices down.

And we’re going to attack that with tax increases?

Rob Port is the editor of SayAnythingBlog.com. In 2011 he was a finalist for the Watch Dog of the Year from the Sam Adams Alliance and winner of the Americans For Prosperity Award for Online Excellence. In 2013 the Washington Post named SAB one of the nation's top state-based political blogs, and named Rob one of the state's best political reporters. He writes a weekly column for several North Dakota newspapers, and also serves as a policy fellow for the North Dakota Policy Council.

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  • mikemc1970

    Wow! Those Democrats sure know how to make those manufacturing jobs, they are always banging on about wanting to create, come to fruition. /rolls eyes

  • http://Sayanythingblog.com The Whistler

    They got their big tax increase on the rich and now only three weeks later they want to raise taxes on the same people.

    What a bunch of greedy idiots.

  • http://profiles.yahoo.com/u/5OJKWQFFFRJ4PO43RD7MNYZFZI Mark

    “And we’re going to attack that with tax increases?”
    WE aren’t. Democrats are. And they’re going to fail.

  • SigFan

    The Democrat’s answer to everything – give us more of your money so we can waste more of your money. Some things never change.

  • cylde

    The health industry is well on its way to nationalization so it is time to socailize and effectively nationalize the energy industry, but you will still be living in a free country. Won’t you??

    • $8194357

      Another Billary socialist wet dream…
      Nationalizing the energy industry…
      Read UN AGENDA 21 for Americas future on
      food production and energy..

      For at least the last two decades here in the USA DC water boys
      and girls have been laying legislation to fall in line and follow
      this blue print to its intended global facist tyranical outcome.

  • Clairvoyant

    Trying to get Democrats to not like taxes is like trying to get a fat person to not like cheeseburgers, donuts, pizza and beer. Ain’t gonna happen!!

    • $8194357

      I dunno..
      I don’t drink anymore…
      But I do believe your right about the pizza…

      • banjo kid

        It took me many years to come to the fact I was not being like I should be after I accepted Christ as my personal savior. I was still drinking until something happened one day to turn me away from all the sin but today I still sin more than I want to . It is not done from our works but through the grace of God. Try as we may we will never measure up except through grace.

        • $8194357

          We were given His garmets of Rightousness.
          Not our own dirty rags,,Grace was given to those He
          knew would accept it, Banjo..

  • splined

    Democrats are fixated on seeing that the only jobs most people will be able to obtain are for financially broke basket cases Wonder how good those jobs will pay the poor?.

  • ‘Tom Crawford

    Haven’t they figured out that business does not pay taxes…..we do. Business passes along the increase to the consumers (us). While they like to say they are raising taxes on the rich and big business…who ends up paying….US. Any increase in cost, taxes, manufacturing and material causes goods and services to cost more for the consumers.

    • Wayne

      I think they know that but their sheeple don’t understand it.

      • banjo kid

        The sheeple are truly blind then .

        • $8194357

          (FORWARD)
          Needing a seeing eye dog blind…

  • $8194357

    The Democrats are totally engulfed with communist ideology.
    Political, econimical, and cultural PC cultural terrrorism as well…
    They are communist to thier ideological socilaist core values.

    http://www.renewamerica.com/columns/vernon/130121

    During and after World War II, Communists and their sympathizers right here in the United States agitated to bolster Soviet interests throughout the entire planet. They went to great lengths to accomplish that goal from their positions of influence throughout the U.S. government, particularly within the State and Treasury Departments. In fact, at one Treasury meeting where pro-Soviet proposals were given the green light, at least six Soviet supporters participated (details below).

    Indeed, the handiwork of Soviet agents within both the U.S. and British governments helped steer the direction of the post-war world in such a way as to enable the Soviet Union to carry on the European aggression where the Nazis had left off.

    Two bosses – official and unofficial

    It was mainly at Tehran and Yalta that U.S. President Franklin D. Roosevelt, British Prime Minister Winston Churchill, and Soviet dictator Joseph Stalin laid the groundwork for the post-war map of the globe. As explained in our last visit in this space, the Yalta Conference was where Alger Hiss, a cunning Soviet agent within the U.S. State Department, filled a void left by an inexperienced Secretary of State Edward R. Stettinius and by a sick, dying FDR (who even in his better days took an all too-trusting view of the Soviets).

    Hiss was very helpful – to Joseph Stalin. As explained in Stalin’s Secret Agents, Alger Hiss somehow rose “from obscurity to become the custodian of all memoranda for the President on topics to be considered at the summit.” As observed by authors M. Stanton Evans and Herbert Romerstein: “[N]ot bad positioning for a Soviet agent whose nominal chieftain, FDR, would soon be meeting with his real one, Stalin.

    Although Tehran and Yalta were the most important of the World War II gatherings, some key decisions came out of bilateral meetings where Roosevelt and Churchill met to outline what was to be done after the Wehrmacht of Hitler’s Germany would meet its anticipated downfall.

    • banjo kid

      Patton was right we should have taken Moscow also; he died because of wanting to .

      • $8194357

        So was McCarthy..
        He was charector assinated and left for dead in modern history books.

    • awfulorv

      If you ask the average American, those who opted for four more years of self flagellation with Obama’s re-election, who the bad guy was, Alger Hiss, or Whitaker Chambers, they will invariably, reveling in their ignorance, choose the latter. And Joe McCarthy, one of the few who had the courage to speak the truth about Communists in the state department, a Senatorial Jimmy The Greek, if you will, is vilified, to this day, by the see no evil, media. Mark my words, when the revisionist historians are through with them they will all, including John Adams, Ben Franklin, even George Washington, be portrayed as drunks and lechers, and worse, as we are presently witnessing with the, ongoing, Jefferson denigration. And who will fill the void when these stalwarts are toppled from their honorable places in history. Hard to tell, the only certainty is, they will be African American.

      • $8194357

        Or muslim..

  • $8194357

    communist democratic core values……

    http://www.helium.com/items/1921860-what-are-communist-values

    http://english.qstheory.cn/culture/201109/t20110924_112464.htm

    http://www.beaufortobserver.net/pageimages/STORMSummation.pdf

    Core values and communism……

    That is why the discussion about the essence of communism is still very much alive. It is topical because we still really don’t understand what communism was, and because of efforts to use one interpretation or other of the past for current purposes. Every attempt to objectively examine the totalitarian past fails immediately if it’s not based on clarifying the concepts that are being worked with and if ideologies, including their historical background, are not separated from the practice of them.
    Ideologies must also be separated from those who – rightly or not – called themselves their implementers. In the case of communism it is therefore
    important to separate its ideology, as it was gradually created in the
    environment of west-European philosophy and mainly its most in-depth Marxist version, from the practices of the political regime that arose in Russia after 1917.

    Whether this Leninist-Stalinist political model was in fact carried out according to Marx’s philosophy, or whether it had completely different roots, is to be examined only after the aforementioned is thoroughly clarified.
    Preconceived judgment that already knows the “answer” has nothing to do with science and testifies to ideological prejudice, or even to the blindness of a persons thinking.

  • banjo kid

    Bottom line is the consumer will pay this tax not big oil or gas . Any one who thinks when the business is taxed that they do not raise the price of their product is living in fantasy land . Problem is the ones that truly work for a living can not raise their income .

  • Lynn Bergman

    Current federal taxes on energy from public lands have the potential to erase our national debt in a decade. This fact is well known to Obama but he wants to raise those federal taxes and instead fund his socialist agenda… in preference to eliminating our national debt. He will have to embrace fossil fuel energy development to leave his socialist legacy. In four years, he may be the most beloved President since FDR; and may seek additional terms. We voted for socialism and will soon have a snoot full of it!

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