By ThinkProgress War Room
The Most Profitable Industry in History Doesn’t Need Tax Breaks
To close out our week of looking at the $1 TRILLION in loopholes, giveaways, credits, and deductions that we could eliminate through tax reform, let’s take a look at some of the most notorious tax giveaways on the books: billions of dollars in giveaways to Big Oil.
The oil industry is the most profitable industry in history, yet taxpayers will still give the industry $40 BILLION in tax giveaways over the next ten years. The industry is easily on track to make over $100 BILLION in 2012 (we’ll find out for sure when they report fourth quarter profits in a few weeks), so they clearly don’t need any more of our money.
Two of the biggest giveaways have been on the books for nearly 100 years, having been put in place in 1916 and 1926 when the industry was just getting going. Subsidies for clean energy are often extended only on yearly basis — if at all, but Big Oil’s been getting its tax breaks for 100 years and it will get them for 100 more unless we do something about it.
These tax breaks are not justifiable, particularly with oil at nearly $100 a barrel and the industry booming. A closer look at how Big Oil is spending its profits demonstrates that taxpayers are subsidizing stock buybacks (which only further enrich oil executives and big shareholders), lobbying, and campaign contributions:
It’s immoral for us to continue handing over billions of dollars to Big Oil when we’re cutting programs for seniors, students, and the most vulnerable Americans. Ending the giveaways for just the five largest oil companies alone would still bring in an additional $25 BILLION in new revenue over the next decade. That’s about the same amount the automatic spending cuts set to go into effect in March will cut from the National Institutes of Health, the government agency that conducts research on cancer and other deadly diseases.
Big Oil and its defenders in Congress argue that eliminating the tax breaks will only hurt consumers because the companies will raise prices to make up the difference. This is simply not true. Experts from Congress’ Joint Economic Committee have concluded that ending these giveaways would no effect on either prices or production.
BOTTOM LINE: It’s time to end Big Oil’s tax bonanza once and for all. They don’t need the money and we simply cannot afford to keep giving them billions of dollars each year.
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