Democrats' Gas Tax Out of Step With American Consumers - and the Facts
Bill Eliminates Percentage Depletion, Which the Big Five Don't Have
Washington, D.C.-Sen. James Inhofe (R-Okla.), Ranking Member of the Senate Committee on Environment and Public Works, released the following statement concerning a major flaw in the Democrats' legislation to increase gas taxes on American drivers and consumers.
"In the rush to introduce their energy tax increase, the Democrats missed an important fact about the tax code: the Big Five oil companies don't receive percentage depletion," Senator Inhofe said. "So not only are they out of touch with the American people - who want more domestic energy production - they are disconnected from the facts. Their legislation, as Democratic leaders have admitted, will do nothing to address the high cost of gasoline for consumers. In fact, it will only stand to make gas more expensive, destroy good-paying jobs, and weaken America's energy security."
Since 1975, major integrated oil and gas companies have been precluded from the option of percentage depletion as a means of cost recovery in petroleum production. The one minor exception has been production from a natural gas well which was sold by a major integrated under a contract, in effect on February 1, 1975. But reportedly those contracts have all long since expired.