Tax Policy
Big oil, big taxes
The Senate debate on a bill to increase oil company taxes ended yesterday when supporters failed to get enough votes to continue. But the misinformation campaign rolls on. By now it’s becoming all too familiar, especially since Politico and The New York Times published leaked talking points being used to counter critics who blame the administration’s energy policy for high gasoline prices.
Déjà vu all over again: Senate targets American oil and gas companies for energy tax hikes
Any doubt we are in the middle of an election season will be erased by casting an eye on Washington, where some in the United States Senate are once again training their sights on the oil and gas industry. The Senate leadership is scheduling a vote in the next few days on a bill its supporters claim will “eliminate unnecessary tax subsidies” for integrated energy companies like ExxonMobil. It bears a loaded title: the “Repeal Big Oil Tax Subsidies Act” (S.2204). As Yogi Berra might say, “It’s déjà vu all over again.”
Who is subsidizing whom?
In its lead editorial yesterday, The Wall Street Journal took a hard look into the Obama administration’s campaign to end so-called “subsidies for Big Oil.” The paper’s conclusion turns the administration’s claims on its head: “The truth is that this industry is subsidizing the government.” This is the flip side of the coin that few realize – the oil and natural gas industry is an enormous source of revenue for the U.S. government.
Removing the disconnect between talk and action on energy policy
Let’s be clear: The U.S. oil and natural gas industry does not receive special “subsidies” or “preferences.” Such claims simply don’t accord with the facts. The fact is that what some call “subsidies” are legitimate provisions of the U.S. tax code that treat our industry the same as other industries. The efforts to prevent oil companies from accessing these provisions achieve nothing but raising the tax burden on the companies that find, produce and manufacture the fuels that are the foundation of the U.S. economy.
Moving beyond the rhetoric on gas prices
As I’ve said before, consumers are understandably frustrated by higher gasoline prices – but no one benefits when discussion about this issue ignores the facts for political reasons. In the Washington Post earlier this week, commentator Charles Lane asks Americans to “Please, everyone, just ignore this blather” when it comes to political grandstanding about gasoline prices. Instead, he says to take a look at what’s really driving the rise in gasoline prices …
A $72 billion contribution to the U.S. economy in 2011
Some in Washington would have you believe that because companies like ExxonMobil are profitable, we are “taking from” the U.S. economy, rather than contributing to it. But the facts prove otherwise. Last year, while ExxonMobil’s operating earnings in the U.S. were $9.6 billion, our total contribution to the U.S. economy was $72 billion. That is how much ExxonMobil spent in the United States on things like taxes, salaries, returns to our investors and money paid to other businesses and industries to keep our U.S. operations running.
