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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Road Walker who wrote (341081)	6/21/2007 7:30:58 PM
From: TimF	Read Replies (1) \| Respond to of 1578142

"WASHINGTON — A proposal to hit oil companies with $29 billion in new taxes advanced in the Senate on Tuesday, targeting the money to energy conservation, wind turbines, electric hybrid cars and clean coal technology." In other words raising taxes on one thing to subsidize another. Googling for more articles, I see those for it call it "cutting subsidies", and those against "raising taxes". Be nice to see the actual details so I could come to my own conclusion. Any link to the actual plan? Hmm maybe I don't want one, it would probably be hundreds of pages. Combining bits of information from several sources it appears the plan might involve raising the leases on oil drilling. I'm not sure that would exactly be either a tax or the removal of a subsidy. If the government thinks the rates where too low, then it could raise them next time they come up for renewal, but I'm not sure breaking them in mid-lease is justified. Hmm, maybe it is a tax - "The legislation would have charged the leaseholders a 13 percent excise tax on the value of future oil and gas taken from the Gulf of Mexico's outer continental shelf." allheadlinenews.com This may be a good summary - "Senate Panel Approves Plan for Gulf Gas, Oil Leases (Update1) By Daniel Whitten June 19 (Bloomberg) -- A U.S. Senate panel approved almost $11 billion in new taxes for oil and natural-gas drilling in the Gulf of Mexico to make up for billions of dollars lost because of flawed leases. The provision, included in a $29 billion tax package the Senate Finance Committee approved today by a 14-6 vote, would charge the leaseholders a 13 percent excise tax on the value of future oil and gas taken from the Gulf's outer continental shelf. Companies with other Gulf leases that pay royalties would be subject to a lower tax. The leases, issued in 1998 and 1999 by the U.S. Minerals Management Service, lack terms included in other years that require royalty payments when oil and gas prices rise. The omission, which the inspector general for the U.S. Interior Department found to be a mistake, may cost up to $10 billion, according to the Government Accountability Office. ``If you have those leases, you are going to have to pay a lot more,'' said Bill Wicker, a spokesman for Senator Jeff Bingaman, who added the new tax to the broader package. The main purpose of the new tax was to raise revenue for alternative energy projects, Wicker said..." bloomberg.com So it seems that for some leases, the feds demanded a percentage of future gains in oil prices through extra royalties. With other leases they did not make this demand. Now they are trying to effectively impose higher royalties through imposing a tax. So it is a new tax, not the repeal of a subsidy, or even a "targeted tax break".