House approves new Oil Company taxes

[Ardentfrost]

Excite News - House Approves New Oil Company Taxes

House Approves New Oil Company Taxes

WASHINGTON (AP) - Declaring a new direction in energy policy, the House on Saturday approved $16 billion in taxes on oil companies, while providing billions of dollars in tax breaks and incentives for renewable energy and conservation efforts.

Republican opponents said the legislation ignored the need to produce more domestic oil, natural gas and coal. One GOP lawmaker bemoaned "the pure venom ... against the oil and gas industry."

The House passed the tax provisions by a vote of 221-189. Earlier it had approved, 241-172, a companion energy package aimed at boosting energy efficiency and expanding use of biofuels, wind power and other renewable energy sources.

"We are turning to the future," said House Speaker Nancy Pelosi.

The two bills, passed at an unusual Saturday session as lawmakers prepared to leave town for their monthlong summer recess, will be merged with legislation passed by the Senate in June.

On one of the most contentious and heavily lobbied issues, the House voted to require investor-owned electric utilities nationwide to generate at least 15 percent of their electricity from renewable energy sources such as wind or biofuels.

The utilities and business interests had argued aggressively against the federal renewables mandate, saying it would raise electricity prices in regions of the country that do not have abundant wind energy. But environmentalists said the requirement will spur investments in renewable fuels and help address global warming as utilities use less coal.

"This will save consumers money," said Rep. Tom Udall, D-N.M., the provision's co-sponsor, maintaining utilities will have to use less high-priced natural gas. He noted that nearly half the states already have a renewable energy mandate for utilities, and if utilities can't find enough renewable they can meet part of the requirement through power conservation measures.

And it goes on from there.

Now, I'm all about not being reliant on oil, but of course, supply and demand will work all that out eventually. By taxing the companies more now, they're just creating a higher cost of living which affects lower income families more than more wealthy families.

How is this a good thing? The last paragraph I quoted says that it'll SAVE people money, but it saves people money by forcing them onto currently more expensive energy sources by falsely raising the prices of oil. Plus we're paying in subsidies for alternate sources of energy already. Greater use will just require that we pay more in subsidies.

Sadly, the majority of people who voted against it probably don't see it like this... they see it as trying to protect their oil buddies. What a sad state.

[6SpeedTA95]

More bullshit by the government.

These companies are already paying ridiculously huge tax bills. Now they're raising their taxes? Ridiculous, these "lawyers" need to take a couple of basic courses in economics. If you do not understand economics then how about you dont make laws regarding economics freaking idiots.

[SoFlaJDM]

damn... poor oil companies.

they're gonna be so broke once the dems get through with raising their taxes

[Publius]

Originally Posted by SoFlaJDM

damn... poor American citizens.

we're gonna be so broke because the oil companies are going to pass on the cost of this new tax on them created by the Democrats to us

Fixed for reality.

[Rouger2]

If there was real competition in the gas and oil industry they would not be able to pass it on. They would take it out of their balloon profits but with no competition they will give it as an excuse to raise the price of gasoline again The poor poor oil companies that really gives me a laugh. Talk about a monopoly they own the Refinerys and the distributers, the gas stations. When are is the government going to get smart and make them sell off their stations. They broke up the the telephone giant why not the oil companies.

[Ardentfrost]

Originally Posted by Rouger2

If there was real competition in the gas and oil industry they would not be able to pass it on. They would take it out of their balloon profits but with no competition they will give it as an excuse to raise the price of gasoline again The poor poor oil companies that really gives me a laugh. Talk about a monopoly they own the Refinerys and the distributers, the gas stations. When are is the government going to get smart and make them sell off their stations. They broke up the the telephone giant why not the oil companies.

Your complaints are created by the gov't. Instead of taxing the companies more so it'll just raise OUR costs, how about we get rid of oil company favoritism.

[6SpeedTA95]

Originally Posted by Rouger2

If there was real competition in the gas and oil industry they would not be able to pass it on. They would take it out of their balloon profits but with no competition they will give it as an excuse to raise the price of gasoline again The poor poor oil companies that really gives me a laugh. Talk about a monopoly they own the Refinerys and the distributers, the gas stations. When are is the government going to get smart and make them sell off their stations. They broke up the the telephone giant why not the oil companies.

What are you talking about? There's several substantial players in the gas/oil markets. Unfortunately NONE of them have control over the cost of their product, OPEC controls oil prices. If you think oil companies are raising the price of gasoline just for the hell of it I'd recommend doing some serious reading on the subject. Refining costs have gone up and so have profits. Refining profit increases the last few years make up about 18 cents per gallon. Total refining charges have gone up about 30 cents the last 3 or 4 years and approximately 9 to 12 cents of that is increased costs imposed by the government for cleaner burning fuels and retrofitting refineries.

[phreak]

Originally Posted by SoFlaJDM

damn... poor oil companies.

they're gonna be so broke once the dems get through with raising their taxes

hey genius... who do you think is actually gonna feel the sting from this?

[Donkey®]

Originally Posted by phreak

hey genius... who do you think is actually gonna feel the sting from this?

If our goal is TRULY to get off oil...this does nothing but lend a hand heading towards it.

[ballz2wallz]

Originally Posted by Donkey®

If our goal is TRULY to get off oil...this does nothing but lend a hand heading towards it.

Yes, I'm sure that was on the Democrats' mind when they passed this.

Yay for raising taxes!

[7th Ninjai]

Great - another tax passed onto Americans under the guise that the Democrats are trying to do something for the common good. Disgusting.

[avsp]

The legislation would end a tax break for buying large SUVs, known as the "Hummer tax loophole" because it allows people who buy some of the most expensive SUVs to write off much of the cost.

Anout time, should've been done years ago. If farmers deserve the tax break then it should be for them not everyone.

On one of the most contentious and heavily lobbied issues, the House voted to require investor-owned electric utilities nationwide to generate at least 15 percent of their electricity from renewable energy sources such as wind or biofuels.

Denmark manages over 20% from wind alone. Their turbine owners & manufacturers associations want to get it up to 50% of 2025 consusumption. Admittedly Denmark is a fairly windy place but for thje US to aim at 15% from all renewables seems unambitious to me. Still one has to start somewhere

Republicans said the House bill did nothing to increase domestic oil and natural gas production or take further advantage of coal, the country's most abundant domestic energy resource.

Boosting the use/development of renewables seems the bills aim. Strategically I'd've thought it would make sense to sit on the carbon reserves for as long as possible anyway.

The White House indicated President Bush might veto the bill if he gets it saying it makes "no serious attempts to increase our energy security or address high energy costs" and would harm domestic oil and gas production.

The bill would repeal for oil companies a tax breaks given in 2004 to help domestic manufacturers compete against foreign companies, and another tax break pertaining to income from foreign oil production. Critics of the two tax provisions called them loopholes that the industry had taken advantage of.

So this legislation still has to be merged with SAenate stuff, get thru there & survive a Bush veto?
If just the SUV tax loophole went thru it would be a start.
Oddly the SUV tax break law is fairly widely known in the UK, even amongst the politically unengaged. (presumably this is down to Clarkson & his minions). Its often cited in vaguely anti-American sentiments as proof of greed/stupidity etc

Petrol should be overpriced as its finite & the market now is undevaling it compared to its long term value. (I realise that in some sense 'value' is market determined & markets judge value 'in the moment'). The market is determining value by the d&s NOW & not building into its consideration the true long term value

By falsely inflating the value now future transitions to a more realistic value will be less painfull.

Either way the bill is mostly about closing tax breaks etc, (IIUC, & i may not do) for the conventional energy industry & so to some extent by bring the petrol industry into line with others it is, in some very limited sense, aiding the more effective working of the market mechanism.

[DosEquis]

you guys are killing me. Here comes $6 a gallon!

Taxes do not determine the price of goods and services. Supply and demand determines it. People will only pay so much for gasoline regardless of the level of taxation on the company producing it. Instead of Exxon bringing in 35 billion for the 3rd quarter, they might have 32 billion in profit instead. Gosh, how are they going to keep the lights on? Taxes used to be significantly higher and oil companies, and corporations in general, were just fine.

[Ardentfrost]

Originally Posted by DosEquis

you guys are killing me. Here comes $6 a gallon!

Taxes do not determine the price of goods and services. Supply and demand determines it. People will only pay so much for gasoline regardless of the level of taxation on the company producing it. Instead of Exxon bringing in 35 billion for the 3rd quarter, they might have 32 billion in profit instead. Gosh, how are they going to keep the lights on? Taxes used to be significantly higher and oil companies, and corporations in general, were just fine.

That's true except where there's a gov't sanctioned monopoly/oligarchy.

[Publius]

Originally Posted by DosEquis

you guys are killing me. Here comes $6 a gallon!

Taxes do not determine the price of goods and services. Supply and demand determines it. People will only pay so much for gasoline regardless of the level of taxation on the company producing it. Instead of Exxon bringing in 35 billion for the 3rd quarter, they might have 32 billion in profit instead. Gosh, how are they going to keep the lights on? Taxes used to be significantly higher and oil companies, and corporations in general, were just fine.

You know, you people talk sarcastically about their profits taking a slight hit. You realize, I hope, that the VAST majority of that profit (likely over 95%) doesn't go into pockets but rather gets reinvested in new or upgrading infrastructure and the like, don't you?

But in all likelihood their profits won't take a hit anyway, our wallets will. When an industry is given a government sanctioned oligopoly like they have been, there is no business reason NOT to pass this new tax on to the end-use customer.

[nbiggershaft]

Originally Posted by Publius

When an industry is given a government sanctioned oligopoly like they have been,

Originally Posted by Ardentfrost

That's true except where there's a gov't sanctioned monopoly/oligarchy.

go on

[DosEquis]

Originally Posted by Publius

You know, you people talk sarcastically about their profits taking a slight hit. You realize, I hope, that the VAST majority of that profit (likely over 95%) doesn't go into pockets but rather gets reinvested in new or upgrading infrastructure and the like, don't you?

But in all likelihood their profits won't take a hit anyway, our wallets will. When an industry is given a government sanctioned oligopoly like they have been, there is no business reason NOT to pass this new tax on to the end-use customer.

Its not going to happen. If gas does increase because of that specific thing, it will be something like $0.05 a gallon. With my 20 gallons on an average gas station visit that will be $1.00 more out of my pocket.

You guys act like this is going to destroy the economy and that we are all going to be broke after this passes because it is goin to cost us another $100 a month in gas. Ice Road truckers are going to miss their season because it will cost them $10 more to fill up.

[SoFlaJDM]

Originally Posted by Publius

You know, you people talk sarcastically about their profits taking a slight hit. You realize, I hope, that the VAST majority of that profit (likely over 95%) doesn't go into pockets but rather gets reinvested in new or upgrading infrastructure and the like, don't you?

i'd really like to believe you, but unless you're some kind of IRS auditor, i just can't/won't

[SoFlaJDM]

Originally Posted by DosEquis

You guys act like this is going to destroy the economy and that we are all going to be broke after this passes because it is goin to cost us another $100 a month in gas. Ice Road truckers are going to miss their season because it will cost them $10 more to fill up.