Oil, Gas Companies Hurt By New Budget

Obama’s new budget contains many changes for oil and gas companies. While they’re not facing a windfall profit tax, they are facing other fees and losing previous tax breaks. USA Today spells it out in bullet form:

  •  $5.3 billion by imposing a new 13% excise tax on offshore oil and gas production in the Gulf of Mexico to close loopholes that gave companies relief from certain royalty payments.
  • $1.2 billion by charging a fee on companies that don’t produce on their Gulf leases. Environmentalists say offshore drilling should not be expanded while existing leases lie fallow. But API spokeswoman Cathy Landry says unused leases are ultimately surrendered.
  • As much as $10 billion by reinstating taxes to clean up hazardous waste sites.
  • $11.5 billion by barring companies from writing off drilling costs, such as labour, and by limiting their ability to write off lease payments.
  • $13.3 billion by scrapping a 6% tax deduction that benefits all U.S. manufacturers.

 

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