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Dems Want $2 Billion Tax Hike On Big Oil

From those economic brainiacs at the Washington Post:

Senate Democrats push to end tax breaks for big oil companies to cut deficit

By Philip Rucker and Lori Montgomery, Published: May 10, 2011

Senate Democrats unveiled a plan Tuesday to save $21 billion over the next decade by eliminating tax breaks for the nation’s five biggest oil companies, a move designed to counter Republican demands to control the soaring national debt without new taxes

Er, this is a new tax. At least, it’s a new tax increase. And we will all have to pay it.

So far, the Democratic tax agenda is focused on ending subsidies for big oil companies, a hugely popular proposal involving what Democrats see as a prime example of wasteful giveaways in the tax code. By raising the issue, Democrats are trying to force Republicans either to drop their rigid stance against new taxes or to defend taxpayer subsidies for some of the world’s most profitable corporations, including Ex­xon Mobil, Shell, BP, Chevron and ConocoPhillips…

Facing pressure from cash-strapped voters to do something about surging gasoline prices, Democrats want to put a spotlight on highly profitable oil companies and cut off taxpayer subsidies to the firms.

How will driving up the cost of oil by $21 billion over the next decade do anything about surging gasoline prices?

Their proposal, which Reid said he could bring up for a vote next week, would close several long-standing tax loopholes, yielding roughly $2 billion a year in savings to be applied to lowering the deficit

This is a tax increase disguised as a way to punish oil companies. For have no fear, Exxon and BP will simply pass on this new additional expense to the person buying gas or heating oil or any petroleum based product.

So in the final analysis this is a simply a $2 billion dollar tax increase on American consumers and businesses. But the Democrats and their accomplices in the media will portray it as a blow against the evil rich oil companies — who help power our economy.

Rolling back tax benefits for oil companies is a hardy perennial in Congress. In 2007, for example, Democrats capped their “100 hours” agenda by passing a measure that targeted oil companies’ eligibility for a manufacturing tax break that effectively lowered their corporate tax rates.

The break, adopted in 2004 to stimulate job growth by trimming tax rates for a range of manufacturers, gives oil companies and other manufacturers a top rate of about 32 percent instead of 35 percent. It is the biggest single budget item; its repeal would save $18 billion. Other oil company tax breaks are decades old.

So we are not talking about any tax breaks that other businesses aren’t getting. But the Democrats and their media minions have to make it sound like the oil companies are getting some special nefarious deal.

But there is no evidence that eliminating them would help lower gas prices. “It is dishonest for any of us to say that there is some magic wand that could be waved and bring down gas prices,” said Sen. Claire McCaskill (D-Mo.)

Raising taxes on oil by $2 billion dollars a year won’t drive the cost of gasoline down? The hell you say!

This article was posted by Steve on Wednesday, May 11th, 2011. Comments are currently closed.

2 Responses to “Dems Want $2 Billion Tax Hike On Big Oil”

  1. GetBackJack says:

    What worries me is that AMERICANS really are as stupid as I’ve long speculated.

    The price of fuel has not changed in 60 years. We’re still paying exactly the same for a gallon of gasoline or diesel as we did back in the day.

    What’s changed is the debauching of the dollar.

    So, quite naturally, Congress chooses now to levy further cumshaw on the oil companies who will pass it on to us.

  2. Chase says:

    “wasteful giveaways in the tax code”

    See, it’s not your money, your earnings, your profit unless the gov’t says you are entitled to it…

    $2b a year is nothing to the spending hogs in Congress. They will have to, and they will, find a lot more fragile trees to tap into to get enough flow of sap if they are going to have enough to cover all the gov’t obligation, which is of course easier to plot and put your name on than is cutting a few billion.

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