The current bill raises $13 billion by eliminating that manufacturers' tax break for the five biggest oil companies -- ExxonMobil Corp., Chevron Corp., ConocoPhillips Co., BP Plc. and Royal Dutch Shell Plc.
"The Administration must strongly oppose" the legislation, said the Office of Management and Budget in its statement of administration policy on Tuesday, "because the bill would use the tax code to target tax increases on a specific industry in a way that will lead to higher energy costs to U.S. consumers and businesses."
Rep. Phil English (R-Penn.) called the bill a "placebo," "energy policy light," and "wrong-headed." He said, "Energy production is the very heart of American manufacturing."
Do you know what these oil companies will do? Drill elsewhere, duh. So much for not relying on foreign oil...
More taxes on US producers will do nothing to lower energy costs; if anything, they will increase them. The Congressional Research Service, Congress' own research arm, has stated these proposals will reduce investments in domestic oil and gas, and will consequently increase imports.
The Facts: These so-called "subsidies" are tax provisions applicable to all US manufacturers and producers. Specifically, the 2004 "American Jobs Creation Act" was enacted to lower the marginal tax rates for U.S. manufacturers and producers, in order to strengthen the American economy and preserve jobs here in the United States. Yet somehow they are described as "subsidies" only for oil companies -- not for other "manufacturers," ranging from farmers, ranchers, and coal and mineral producers, to coffee grinders, movie studios and video game producers.
The pending House energy tax bill would repeal the 2004 legislation in full for only 5 oil and natural gas companies, singling them out for "punishment" and ignoring the fact that on the "record" profits they have made, they have also paid record taxes. In a study published recently in Tax Notes, the three highest effective tax rates for 2004-2006 of some 80 companies surveyed were ConocoPhillips, ExxonMobil, and Chevron. These tax rates were some 13 percentage points above the 30% effective tax rate average for all 80 companies.
The Facts: Oil companies are simply being taxed in the same way as all other US manufacturers and producers, and are paying record taxes on their earnings. Increasing tax rates further just on a handful of US companies is not "taking subsidies" away, but rather is simply imposing a windfall profits tax on a few companies, which will only serve to further increase our dependence on foreign energy sources, not reduce it.
Claim: "Congress... [is] working to lower energy costs, improve national security by making us more energy independent, end taxpayer-financed subsidies to big oil companies earning record profits, and combat global warming."
The Facts: Increasing taxes on US producers will do nothing to lower energy costs; if anything it will increase them. The Congressional Research Service, Congress' own research arm, has stated these proposals will reduce investments in domestic oil and gas, and will consequently increase imports. That would not make us more "energy independent."
3 comments:
What is one to think when community or business does not use the job creation money activly or in the publics scrutiny. It could happen if it was used in activity that was supported by 80% of the adult population.
The money from this 2004 Job Creation Act should be invested in the hightest returns possible without regard to industry.
Please help me make that happen?
There are several new elements to play in this effort.
http://ulticharnetwork.blogspot.com
Looking for investors in Early Reading Skills Delivered.
If I were one of the 290 multi-national companies who repatriated over 300 Billion Dollars with a tax savings to my shareholders of (over 29%) 87 Billion Dollars I would be looking for investments that create high value jobs in the USA.
If I were a manufacturing company and given the 2004 Production Activities Expense Deduction to create lower taxes (75 Billion Dollars per year) so I could make investments in high value jobs in the USA I would also be looking for (worried about) who will actually fill the high value jobs I create.
I would not give the money away, but I would invest because I have been trusted to invest and my shareholders (ethically my primary responsibility and most influential party) are “generally everyone with a 401K” in the USA.
I would start with a considered “what if commitment” to public schools, cities and counties to pay me back if I invest in the child’s increased ability to learn.
Made simple for the economic elevator pitch: Start -- I invested in creating a local area robust sensitive language period for the most at risk age 3-6 children so that their brain synapses closed on full language content. The community and its schools and governments pay me back with a monetized return from the ROI savings being discussed. — End: I would even help them figure out a way to do it. I would even given them pro bono services to get it in place.
For example, If we squared off the territory and controlled the Early Reading Skills Delivery so they were adequate to meet the requirements of the kindergarten teachers it has been agreed there would be huge savings. Way in excess of a payback.
GEE! It sounds like our veterans returning from Iraq and Afghanistan would know how to do this square dance without guns, using only butter. A returning mission for the veterans of Literacy is Freedom and the Agenda of Opportunity for the World. Delivered locally by the experts already on the street fully justified within the Free Enterprise Sector of the economy. Think we could find the deliverers of the new money by engaging the moral courage of the 1.5 million veterans who have returned? You think our flat world communication systems would employ most of our war disabled vets in this campaign.
Well its just a thought, because I am not a multinational, but wait! I am the indirect stockholder in many of the best of them. I hope my broker has me invested in the best of them. How did that happen! Congress gave "me" the tax break to do the investing in my neighborhood. WOW, man it is great to be in the USA. As they say, Only in America.
Now can we just monetize that ROI commitment for the first steps.
Labels: Early Reading Skills Delivered, ETHICs, Investor, USA VALUES, USAVALUES
ExxonMobil
Chevron
Shell
These companies are giving money back to society. The thing is the public reads $10B profit, and they thing obscene! However, that $10B profit (definition of profit = amount of money you have after your investments) is on $100B, yes one hundred billion dollars in investment. that is on average a 10% return on investment for the industry. It takes a lot of money to dig that oil and gas out of the hardest reaching places on this earth.
Talk to the banking industry and pharmaceutical industry, with 20% profit, and ask them what they are doing with their profits.
The oil and natural gas industry is one of the world's largest industries. Its revenues are large, as are the costs of providing consumers with the energy they need. Among those costs are finding and producing oil and natural gas, refining, distributing and marketing those refined products. The energy Americans consume today is brought to us by investments made years or even decades ago. Today's oil and natural gas industry earnings are invested in new technology, new production and environment and product quality improvements to meet tomorrow's energy needs. The industry's earnings are very much in line with other industries, and often they are lower.
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