OIL AND GAS:
Subsidies remain in House Dems' cross hairs
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House Democrats are continuing a crusade against the oil industry's tax incentives, pitching their repeal as a potential revenue source to the congressional "supercommittee" looking for ways to cut the deficit.
Committee leaders in both chambers last week offered their suggestions to the 12-member budget panel, and at least two ranking Democrats specifically targeted the oil industry's tax breaks as a possible revenue stream. Separately, a group of 37 House Democrats sent their own proposal to the supercommittee that also calls for axing the incentives.
"In the current budgetary environment, the United States can no longer afford to give away billions of dollars every year to corporations earning billions of dollars in profits and costing American taxpayers twice: at the pump and through the tax code," Rep. Peter Welch (D-Vt.), who spearheaded the letter from the group of Democrats, said in a statement.
The ranking Democrats on two key committees also have called on the budget panel to kill the incentives.
Rep. Ed Markey (D-Mass.), ranking member of the Natural Resources Committee, and Rep. Elijah Cummings (D-Md.), ranking member of the Oversight and Government Reform Committee, both cite figures released by the Office of Management and Budget that say ending a number of the tax breaks could save the United States $43 billion over the next 10 years. Welch and the other Democrats say ending the industry's incentives could save up to $122 billion in that same time period.
The tax break debate, which dominated Capitol Hill energy discussions this spring, died down this summer after the Senate voted down a measure that would have repealed several tax breaks for the largest oil companies in order to pay down the deficit by $21 billion over the next decade.
President Obama has repeatedly called on Congress to cut the incentives, most recently in the jobs plan he outlined last month. The Senate failed to move forward on a version of that measure last week, but it did not include the tax break language that Obama had originally requested; Democrats pulled the language in an effort to attract GOP votes.
Republicans and pro-drilling Democrats are staunchly opposed to ending the industry's tax breaks outside of a comprehensive tax reform debate. Still, Democrats have made it clear it is an issue they are not going to let go.
"If comprehensive tax reform is not feasible in the limited time available, the Joint Select Committee should consider targeted efforts to raise additional revenue in a balanced way to ensure that tax obligations are more fair," Cummings wrote in his letter to the supercommittee.
Markey in his letter also proposed a number of additional fees and charges to the oil industry. Among them are repealing royalty-relief laws that allow oil companies to drill on some federal leases without paying royalties, increasing royalty rates for onshore drilling, imposing a fee on non-producing oil and gas leases and increasing offshore oil and gas inspection fees, among others.
The requests come as the 12-member supercommittee, created as part of the high-profile August deal to raise the federal debt limit, is nearing the end of its window to propose a more than trillion-dollar deficit-reduction package. The debt limit deal gives lawmakers until Nov. 23 to present a plan to Congress.
Click here to read the letter from the 37 House Democrats.
Click here to read the letter from Cummings.
Click here to read the letter from Markey.