Senate “Gang of 10” Energy Plan
Recently the Senate “Gang of 10” released an outline of the proposed energy compromise reached between five Democrats and five Republicans. While language has yet to be released, highlighted below are our some initial concerns with the proposal.
Extremely Limited Offshore Production:
The off-shore provisions of this grand compromise are woefully inadequate to addressing the current crisis. The proposal only opens additional areas in the Gulf of Mexico to leasing and permits only the States of Virginia, North and South Carolina and Georgia to opt in to a leasing program. The proposal even creates a new “no drill zone” within 50 miles of the coast in areas where drilling would be permitted, permanently taking off-line some of the most promising areas for production. Presumably the ban on production remains in place in Florida, along the West Coast and off of Alaska.
American families would be better served to just let the current offshore ban expire.
New Government Subsidies Funded by Tax Increases:
Rather than using revenues from increased oil and gas production to fund competitive research into alternative fuels as proposed by House Republicans, the Gang of Ten proposal includes what the Wall Street Journal calls “a Democratic giveaway” that is funded by $84 billion in tax increases.
Approximately $30 billion in new taxes will come from American oil and gas companies through repeal of the Section 199 manufactures deduction and increased revenue on oil and gas leases in the Gulf of Mexico. Raising taxes on one specific industry, American oil and gas companies will make it harder to expand oil and gas production in America.
An additional $55 billion in new taxes will be disclosed at a later date according to their press release: “Remaining offsets will be finalized in consultation with the Finance Committee after accounting for interaction effects with other pending legislation.” Since the release of their plan, rumored tax increases have included:
Ø Economic substance doctrine, which will raise taxes on American companies by allowing the IRS to question their business decisions
Ø Delaying worldwide interest allocation, making U.S. based international companies less competitive compared to foreign based companies
Ø Modifying the tax treatment of offshore non-qualified deferred compensation
Fails the “All of the Above” Test:Keeps ANWR off-line
Ø Continues the policy of denying us access to our vast oil-shale reserves
Ø Does nothing to cut the bureaucratic red tape that hinders the construction of new refineries
Ø Fails to repeal the prohibition on government purchasing of alternative energy including Coal-to Liquids
Extremely Limited Offshore Production:
The off-shore provisions of this grand compromise are woefully inadequate to addressing the current crisis. The proposal only opens additional areas in the Gulf of Mexico to leasing and permits only the States of Virginia, North and South Carolina and Georgia to opt in to a leasing program. The proposal even creates a new “no drill zone” within 50 miles of the coast in areas where drilling would be permitted, permanently taking off-line some of the most promising areas for production. Presumably the ban on production remains in place in Florida, along the West Coast and off of Alaska.
American families would be better served to just let the current offshore ban expire.
New Government Subsidies Funded by Tax Increases:
Rather than using revenues from increased oil and gas production to fund competitive research into alternative fuels as proposed by House Republicans, the Gang of Ten proposal includes what the Wall Street Journal calls “a Democratic giveaway” that is funded by $84 billion in tax increases.
Approximately $30 billion in new taxes will come from American oil and gas companies through repeal of the Section 199 manufactures deduction and increased revenue on oil and gas leases in the Gulf of Mexico. Raising taxes on one specific industry, American oil and gas companies will make it harder to expand oil and gas production in America.
An additional $55 billion in new taxes will be disclosed at a later date according to their press release: “Remaining offsets will be finalized in consultation with the Finance Committee after accounting for interaction effects with other pending legislation.” Since the release of their plan, rumored tax increases have included:
Ø Economic substance doctrine, which will raise taxes on American companies by allowing the IRS to question their business decisions
Ø Delaying worldwide interest allocation, making U.S. based international companies less competitive compared to foreign based companies
Ø Modifying the tax treatment of offshore non-qualified deferred compensation
Fails the “All of the Above” Test:Keeps ANWR off-line
Ø Continues the policy of denying us access to our vast oil-shale reserves
Ø Does nothing to cut the bureaucratic red tape that hinders the construction of new refineries
Ø Fails to repeal the prohibition on government purchasing of alternative energy including Coal-to Liquids
Office of the Republican Whip
posted by HeavyHanded at
10:21 PM
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