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Dems push plan to tax oil companies' profits, send checks to Americans during Russia-Ukraine price spike

Democrat control of congress?


"

Reagan to Back Repeal of Oil Windfall Tax​


L.A. Times Archives
April 22, 1986 12 AM PT

United Press International

WASHINGTON —
President Reagan responded to pleas for help from states battered by the plunge in oil prices today by notifying Congress that he will support early repeal of the windfall profits tax on oil companies.
Rep. Mickey Edwards (R-Okla.) said he had received a similar message from the White House shortly before he and four other oil-state lawmakers met with Reagan to discuss the status of the domestic oil industry.
The move to repeal the tax, enacted in 1980 as a means of recapturing revenues generated by the decontrol of oil prices, is consistent with the opposition Reagan has voiced to the levy since the 1980 campaign.
At its peak in 1981, the tax--set to expire at the end of 1990--netted $23 billion for the U.S. Treasury. That figure has been declining steadily ever since and is expected to be down to $4.2 billion this year with the recent plunge in oil prices."


"

Repeal​

On August 23, 1988, amid low oil prices, the tax was repealed when President Ronald Reagan signed P.L. 100–418, The Omnibus Trade and Competitiveness Act of 1988.[3] Reagan had objected to the tax during his 1980 presidential campaign and promised to repeal it.[1] As with the enactment, Congress was motivated by several factors:

LMAO... And the house was still under DNC control when they repealed the tax...
 
Yep, that's the one... Why did Saint Reagan not work with congress to repeal the tax?
UK opposition parties are pushing for a windfall tax on oil companies. Of course the Tory government wants nothing to do with it...
We're facing frightening energy price hikes which will leave many with a stark choice; heat or eat...
 
Yep, that's the one... Why did Saint Reagan not work with congress to repeal the tax?
He ran against that tax and ultimately did repeal it. He was president not king and had to work with a democrat congress.
 
LMAO... And the house was still under DNC control when they repealed the tax...
Reagan became so popular he bent democrats to his will. That is his legacy. He turned me from dirty hippie democrat to a conservative.
 
I’ve said before that Biden is Carter 2.0 and here we go. If this happens say hello to gas lines again.


"Big Oil Windfall Profits Tax." According to Khanna, D-Calif., and Whitehouse, D-R.I., the bill would levy a tax on oil barrels sold by large producers "equal to 50 percent of the difference between the current price of a barrel of oil and the pre-pandemic average price per barrel between 2015 and 2019."

The money from that tax would be sent to consumers as a quarterly rebate”


This is the same thinking as 'tax ourselves into prosperity', and is just as utterly stupid.
Something is too expensive, tax it? That'll make it more affordable? 🤣
 
That was an entirely different mess - it taxed (placed a tariff on?) all imported crude oil.

Hmmm... reading the actual statute I don't see that anywhere in the law...

Crude Oil Windfall Profit Tax Act of 1980 - =Title I: Windfall Profit Tax on Domestic Crude Oil= - Amends the Internal Revenue Code to impose upon domestic oil producers an excise tax on the windfall profit from taxable crude oil produced during each taxable period (March 1980 and each calendar quarter thereafter). Defines "taxable crude oil" as all domestic crude oil other than: (1) any crude oil from a qualified governmental or charitable interest; (2) any exempt Indian oil; (3) any exempt Alaskan oil; and (4) any exempt front-end oil.

Sets the rate of such tax with respect to each barrel of taxable crude oil at 70 percent of the windfall profit on tier one oil (50 percent for independent producer oil), 60 percent of the windfall profit on tier two oil (30 percent for independent producer oil), and 30 percent of the windfall profit on tier three oil. Defines "tier one oil" as taxable crude oil other than tier two or three oil. Defines "tier two oil" as stripper well oil and oil from an economic interest in a National Petroleum Reserve held by the United States. Defines "tier three oil" as newly discovered oil, heavy oil, and incremental tertiary oil. Defines "independent producer oil", for purposes of the reduced tax rates, as daily oil production which does not exceed 1,000 barrels.

Defines "windfall profit" as the excess of the removal price of a barrel of crude oil (amount for which barrel is sold) over the sum of the base price adjusted for inflation and the amount of the severance tax adjustment. Specifies that the windfall profit on any barrel of crude oil may not exceed 90 percent of the net income attributable to such barrel. Provides that the net income attributable to a barrel shall be determined by dividing the taxable income from property attributable to the taxable crude oil by the number of barrels of such oil produced from the property during the taxable year. Specifies that taxable income from the property attributable to taxable crude oil shall be determined without any deductions for depletion, intangible drilling and development costs, the windfall profit tax or qualified tertiary injectant expenses. Provides that taxable income shall be reduced by the deduction for cost depletion which would have been allowable if all intangible drilling costs and qualified tertiary injectant expenses had been capitalized and taken into account in computing cost depletion for the property for all periods. Prescribes special rules for determining the taxable income limit in the case of certain transfers of proven oil or gas properties transferred after 1978 and where a portion of the taxable crude oil produced is applied in discharge of a production payment.

Permits a taxpayer election to capitalize qualified tertiary injectant expense. Defines "qualified tertiary injectant expenses" as expenses incurred for non-hydrocarbon injectants used in the recovery of oil and gas.

Sets forth base prices for the three tiers of oil.

Exempts income from any interest in oil production owned by Federal, State or local governments, Indian tribes, or medical or educational charities from the windfall profit tax.

Imposes requirements upon the first purchaser of crude oil with respect to the withholding of windfall profit tax amounts.

Provides for a phase-out of the windfall profit tax over a 33-month period starting with the latter of January 1988 or the first month (but not later than January 1991) after the Secretary of the Treasury estimates the aggregate net windfall profit tax revenue will exceed $227,300,000,000.


 
they don't have to pay you. that's part of their genius.

they pick specific stories to highlight, they stay on the offensive and they know their dedicated Fox audience (including you) will run with the stories they highlight.


you probably didn't even know you're being played, right?
So democrats aren’t proposing this tax? FOX made it up? That’s your story?
 
This is the same thinking as 'tax ourselves into prosperity', and is just as utterly stupid.
Almost as stupid as "tax cuts pay for themselves"
Something is too expensive, tax it? That'll make it more affordable? 🤣
Don't have enough money to spend on essential programs? cut taxes, that will make increase revenue lol.
 
Hmmm... reading the actual statute I don't see that anywhere in the law...

Crude Oil Windfall Profit Tax Act of 1980 - =Title I: Windfall Profit Tax on Domestic Crude Oil= - Amends the Internal Revenue Code to impose upon domestic oil producers an excise tax on the windfall profit from taxable crude oil produced during each taxable period (March 1980 and each calendar quarter thereafter). Defines "taxable crude oil" as all domestic crude oil other than: (1) any crude oil from a qualified governmental or charitable interest; (2) any exempt Indian oil; (3) any exempt Alaskan oil; and (4) any exempt front-end oil.

Sets the rate of such tax with respect to each barrel of taxable crude oil at 70 percent of the windfall profit on tier one oil (50 percent for independent producer oil), 60 percent of the windfall profit on tier two oil (30 percent for independent producer oil), and 30 percent of the windfall profit on tier three oil. Defines "tier one oil" as taxable crude oil other than tier two or three oil. Defines "tier two oil" as stripper well oil and oil from an economic interest in a National Petroleum Reserve held by the United States. Defines "tier three oil" as newly discovered oil, heavy oil, and incremental tertiary oil. Defines "independent producer oil", for purposes of the reduced tax rates, as daily oil production which does not exceed 1,000 barrels.

Defines "windfall profit" as the excess of the removal price of a barrel of crude oil (amount for which barrel is sold) over the sum of the base price adjusted for inflation and the amount of the severance tax adjustment. Specifies that the windfall profit on any barrel of crude oil may not exceed 90 percent of the net income attributable to such barrel. Provides that the net income attributable to a barrel shall be determined by dividing the taxable income from property attributable to the taxable crude oil by the number of barrels of such oil produced from the property during the taxable year. Specifies that taxable income from the property attributable to taxable crude oil shall be determined without any deductions for depletion, intangible drilling and development costs, the windfall profit tax or qualified tertiary injectant expenses. Provides that taxable income shall be reduced by the deduction for cost depletion which would have been allowable if all intangible drilling costs and qualified tertiary injectant expenses had been capitalized and taken into account in computing cost depletion for the property for all periods. Prescribes special rules for determining the taxable income limit in the case of certain transfers of proven oil or gas properties transferred after 1978 and where a portion of the taxable crude oil produced is applied in discharge of a production payment.

Permits a taxpayer election to capitalize qualified tertiary injectant expense. Defines "qualified tertiary injectant expenses" as expenses incurred for non-hydrocarbon injectants used in the recovery of oil and gas.

Sets forth base prices for the three tiers of oil.

Exempts income from any interest in oil production owned by Federal, State or local governments, Indian tribes, or medical or educational charities from the windfall profit tax.

Imposes requirements upon the first purchaser of crude oil with respect to the withholding of windfall profit tax amounts.

Provides for a phase-out of the windfall profit tax over a 33-month period starting with the latter of January 1988 or the first month (but not later than January 1991) after the Secretary of the Treasury estimates the aggregate net windfall profit tax revenue will exceed $227,300,000,000.



Yep, I fixed it.

Congress was also concerned that the tax had increased the nation's dependence on imported oil. The tax was an excise tax on oil produced domestically in the United States; it was not imposed on imported oil. Domestic oil producers could not shift the tax forward as a higher oil selling price because the purchaser would merely substitute imported or tax-exempt crude. The tax caused domestic oil production losses in every year until 1986, when crude prices declined below adjusted base prices resulting in zero windfall profit tax.

 
I’ve said before that Biden is Carter 2.0 and here we go. If this happens say hello to gas lines again.


"Big Oil Windfall Profits Tax." According to Khanna, D-Calif., and Whitehouse, D-R.I., the bill would levy a tax on oil barrels sold by large producers "equal to 50 percent of the difference between the current price of a barrel of oil and the pre-pandemic average price per barrel between 2015 and 2019."

The money from that tax would be sent to consumers as a quarterly rebate”


They're bringing it on themselves, because they are directly and personally responsible for a good portion of the price increases.

 
Reagan became so popular he bent democrats to his will. That is his legacy. He turned me from dirty hippie democrat to a conservative.
The tea party and trump did the same to me in the opposite direction
 
So democrats aren’t proposing this tax? FOX made it up? That’s your story?
that has nothing to do with all the Fox stuff you run with.

it's like you don't even know "how" they're manipulating you.
 
I’ve said before that Biden is Carter 2.0 and here we go. If this happens say hello to gas lines again.


"Big Oil Windfall Profits Tax." According to Khanna, D-Calif., and Whitehouse, D-R.I., the bill would levy a tax on oil barrels sold by large producers "equal to 50 percent of the difference between the current price of a barrel of oil and the pre-pandemic average price per barrel between 2015 and 2019."

The money from that tax would be sent to consumers as a quarterly rebate”


There are 535 members of Congress (including Senators). One or two of them are always pushing something. If you want to get you panties a bunch over the ideas of one or two, then you are going to have a permanent case of chaffing. Let us know if this gets any traction. That said, there is precedent for windfall profit taxing of oil companies.

Big oil makes big money in the good times and barely survives the bad times. It’s the name of the game.
"Big oil" makes big money in good times and makes less money in bad times. I don't recall a big oil company ever failing. Last year (2020 in the pandemic) was the first year that ExxonMobil EVER lost money. The pandemic year was a business anomaly.

 
Big oil makes big money in the good times and barely survives the bad times. It’s the name of the game.
"Big oil" makes big money in good times and makes less money in bad times. I don't recall a big oil company ever failing.
 
Big oil" makes big money in good times and makes less money in bad times. I don't recall a big oil company ever failing.

Oil prices turned negative. Hundreds of US oil companies could go bankrupt​



“At $10, almost every US E&P company that has debt will have to file Chapter 11 or consider strategic opportunities," Abramov said.”


 
Another wedge in America?Us against big oil? Make another boogeyman? You may be right.

Not really a new wedge. Theyve been doing this for a while. Its just a bigger wedge now. If you look at the big oil companies theyre not seeing wind fall profits. They lost money in 2020, made money in 2021. Probably making more money this year, but similar margins. And theyre paying a billion a month in taxes (which they pass on).
 
I’ve said before that Biden is Carter 2.0 and here we go. If this happens say hello to gas lines again.


"Big Oil Windfall Profits Tax." According to Khanna, D-Calif., and Whitehouse, D-R.I., the bill would levy a tax on oil barrels sold by large producers "equal to 50 percent of the difference between the current price of a barrel of oil and the pre-pandemic average price per barrel between 2015 and 2019."

The money from that tax would be sent to consumers as a quarterly rebate”



Yup.

The windfall profits tax was a failure in the 1970’s, and will be in the 2022.
 
There are 535 members of Congress (including Senators). One or two of them are always pushing something. If you want to get you panties a bunch over the ideas of one or two, then you are going to have a permanent case of chaffing. Let us know if this gets any traction.
One or two? 12 US senators.

"Washington, D.C. – With gas prices skyrocketing in recent days against a backdrop of continued Russian aggression in Eastern Europe, U.S. Senator Sheldon Whitehouse (D-RI) has introduced the Big Oil Windfall Profits Tax to curb profiteering by oil companies and provide Americans relief at the gas pump. The Senate legislation is cosponsored by Senators Jeff Merkley (D-OR), Elizabeth Warren (D-MA), Bernie Sanders (I-VT), Richard Blumenthal (D-CT), Tammy Baldwin (D-WI), Sherrod Brown (D-OH), Jack Reed (D-RI), Ed Markey (D-MA), Cory Booker (D-NJ), Michael Bennet (D-CO), and Bob Casey (D-PA). Congressman Ro Khanna (D-CA-17) will introduce the legislation in the U.S. House of Representatives.""
 
Yup.

The windfall profits tax was a failure in the 1970’s, and will be in the 2022.

It was in the 1980's and was also when we banned exporting US produced oil... What failed about it?
 
One or two? 12 US senators.

"Washington, D.C. – With gas prices skyrocketing in recent days against a backdrop of continued Russian aggression in Eastern Europe, U.S. Senator Sheldon Whitehouse (D-RI) has introduced the Big Oil Windfall Profits Tax to curb profiteering by oil companies and provide Americans relief at the gas pump. The Senate legislation is cosponsored by Senators Jeff Merkley (D-OR), Elizabeth Warren (D-MA), Bernie Sanders (I-VT), Richard Blumenthal (D-CT), Tammy Baldwin (D-WI), Sherrod Brown (D-OH), Jack Reed (D-RI), Ed Markey (D-MA), Cory Booker (D-NJ), Michael Bennet (D-CO), and Bob Casey (D-PA). Congressman Ro Khanna (D-CA-17) will introduce the legislation in the U.S. House of Representatives.""

President Biden should just reinstate the ban on exporting US crude oil.. no need for congress at all....
 
I’ve said before that Biden is Carter 2.0 and here we go. If this happens say hello to gas lines again.


"Big Oil Windfall Profits Tax." According to Khanna, D-Calif., and Whitehouse, D-R.I., the bill would levy a tax on oil barrels sold by large producers "equal to 50 percent of the difference between the current price of a barrel of oil and the pre-pandemic average price per barrel between 2015 and 2019."

The money from that tax would be sent to consumers as a quarterly rebate”


So they just cut production to 300,000 or less barrels per day and raise the price even higher to maintain their profits while avoiding the tax.
 
It was in the 1980's and was also when we banned exporting US produced oil... What failed about it?

I suppose that depends on your definition of failure. It increased oil imports and reduced domestic oil production.

Over the 1980-1986 period, it is estimated that, depending on the assumed supply curve price elasticity, the tax reduced domestic oil production from between 320 million barrels (1.2% of domestic production) and 1,268 million barrels (4.8% of domestic production). The effect of reducing domestic oil production was to increase the level of imported oil. The estimated production losses caused by the tax, as a % of the actual level of imported oil, under three assumed supply curve elasticities range from 3.2% of total imports to 12.7% of imports for this period, depending on price elasticity.

The tax also may have distorted the way resources were allocated within the oil industry. Since the tax was imposed on oil production — i.e., upon its removal and sale — extraction (and other upstream operations) was penalized and other aspects of the business (refining and marketing, the downstream operations) become relatively favored. Thus it created financial incentives to shift resources from exploration and drilling to refining and marketing.

 
President Biden should just reinstate the ban on exporting US crude oil.. no need for congress at all....
Nice dodge.

What gives the POTUS the authority to ban the export of oil? Shouldn't the American people (through congress) have some input on such a massive, impactful decision?
 
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