Blumenauer introduces bill to close billions of dollars in oil industry tax loopholes

Press release from the office of Congressman Congressman Earl Blumenauer:

For decades, the oil industry has enjoyed billions of dollars in subsidies and tax breaks despite making record-breaking profits. While ordinary Americans pay into the tax system, Big Oil benefits from exemptions that will total around $35 billion over the next five years. At a time when the top five oil companies made more than $123 billion in profits in 2007, these unnecessary carve-outs have exacerbated the deficit, undermined our ability to invest in clean, renewable energy, and damaged our environment – with the tragic oil spill in the Gulf of Mexico demonstrating the consequences of our addiction to oil.

At time when we are working to recover the economy and curb the deficit, America cannot and should not subsidize the most profitable corporations in the world. President Obama’s FY 2011 Budget proposed ending many of these tax breaks, which could reduce the deficit and fund national priorities from education to clean energy. At the recent G-20 Summit in Pittsburgh, the administration again agreed to eliminate these subsidies, which will save taxpayers an estimated $35 billion over 10 years.

Re-Balance our Energy Investments
This would help break America’s addiction to oil, curb global warming pollution, and reduce our dependence on foreign oil imports. Through targeted tax credits to renewable energy and efficiency efforts, we will create hundreds of thousands of jobs in construction, manufacturing, installation, electrical, and other industrial sectors.

The unique tax breaks enjoyed by the oil industry provide unnecessary and harmful incentives for exploration, drilling, and refining activities that cause serious pollution and severely impact public health. They also keep America tied to oil like an anchor, which is a threat to the environment and national security. The United States consumes 25% of the world’s oil but has less than 3% of the proven reserves. Simple math shows that in the decades to come, there is not enough oil to fuel our transportation sector – which accounts for 75% of our oil consumption.

By continuing to artificially subsidize fossil fuels, we undermine investments that will guarantee our energy dependence. It is time for our country to shift gears and direct our limited resources away from the fuels of the past and towards initiatives that will secure a clean and secure energy future.

Highlights of the Legislation
The End Big Oil Tax Subsidies Act would remove unnecessary subsidies for the biggest oil companies, including a number of the tax credits, deductions, special depreciation rules, exclusions, and exemptions for various activities associated with exploring, drilling and refining activities. Unlike the burgeoning clean energy industries, oil companies have been drilling, exploring, and researching for decades and no longer need help from the American taxpayer.

To protect American small businesses, these subsidies will be preserved for small independent producers.

For a full summary of the provisions in the bill, read the full press release here.