Navajo landmark shiprock formation, four corners, smog from coal fired power plants
Jane Pargiter, EcoFlight
What gifts will the fossil fuel industry receive this year courtesy of the American Taxpayer?
Actually, the fossil fuel industry takes a lot from Americans – in addition to the price we pay to fill our gas tanks and light our homes, Americans pay billions in dollars in taxes to fund giveaways to the fossil fuel industry. These giveaways don’t just hurt our wallets – they hurt the lands that Americans treasure, encouraging the destruction of our last wild places.
This holiday season, The Wilderness Society wrestled with a tough gift-giving dilemma – what do you get for the industry that has everything? Then it hit us -- a 12 day review of the subsidies the fossil fuel industry receives might be the perfect gift.
This dirty dozen shows just how many gifts are showered on the fossil fuel industry – gifts that it is time to stop giving. (costs are based on a 10-year budget impact, the same way most things for the federal budget are calculated)
The 12 days of fossil fuel giveaways
Day 1: On the first day of fossil fuel giveaways we gave the oil, gas and coal industry ... Expensing of Intangible Drilling Costs - Cost: $7.8 billion This provision allows oil companies to get repaid for the money they spend to run their businesses. Eliminating this credit would raise $7.8 billion in revenue through FY 2020. More.
Day 2: On the second day of giveaways we gave the fossil fuel industry...Exemption to Passive Loss Limitation for Working Interests in Oil and Gas Properties - Cost: $180 million This provision lets oil and gas comapnies write off losses from investments in other industries. More
Day 3: On the third day of giveaways we gave the fossil fuel industry...Expensing of exploration and Development Costs for Coal companies - Cost: $413 million. This tax break allows coal companies to immediately write off any costs related to finding new coal mines. More
Day 4: On the fourth day of giveaways we gave the fossil fuel industry...Percentage Depletion for oil and natural gas wells - Cost: $10 billion. A $10 billion tax break to allow oil and gas companies to write of expenses on wells that are going dry. More
Day 5: On the fifth day of giveaways we gave the fossil fuel industry...2 year Geological and Geophysical Amortization - Cost: $1.1 billion. This tax break allows some companies to take more of their write-offs at once, rather than over the course of years. More
Day 6: On the sixth day of giveaways we gave the fossil fuel industry...Domestic Manufacturing Deduction for Oil and Gas Production - Cost $17.3 billion. A tax break meant for domestic goods manufacturing that the oil and gas companies are taking advantage of. More
Day 7: On the seventh day of giveaways we gave the fossil fuel industry...Domestic Manufacturing Deduction for Coal Domestic Manufacturing Deduction for Coal and Other Hard Mineral Fossil Fuels - Cost: $57 million. Another abuse of the tax break above. More
Day 8: On the eighth day of giveaways we gave the fossil fuel industry...Expensing of Liquid Fuel Refineries - Cost: $2.3 billion. This allows oil and gas companies to deduct the expenses of purchasing equipment to turn oil and natural gas into usable fuels. More
Day 9: On the ninth day of giveaways we gave the fossil fuel industry...Percentage Depletion for Coal mining - Cost $1.1 billion. Similar to Day 4, this tax break for the coal industry lets them deduct the decreased value of a mine as it is being emptied of its valuable coal. More
Day 10: On the tenth day of giveaways we gave the fossil fuel industry...Capital Gains Treatment of Certain Royalties for Coal - Cost $1.1 billion. Rather than taxing all of the royalties for coal the same way, some are taxed at a substanitally lower rate. More
Day 11: On the eleventh day of giveaways we gave the fossil fuel industry...Free Offshore Oil drilling in the Gulf of Mexico - Cost: $9 billion. Currently, oil comapnies are allowed to drill in parts of the Gulf of Mexico - in federally owned waters - without paying any royalties to American taxpayers. More
Day 12: On the twelfth day of giveaways...the industry gave back? Not to the taxpayers, of course. No, this is the $8.8 million dollars that the oil, gas, and coal industries have given to Members of Congress in campaign contributions. More
P.S. The fossil fuel industry doesn’t seem to think they receive subsidies at all! They recently argued with Congressman Ed Markey over the definition of a “subsidy” – claiming that they didn’t receive any. We think they doth protest a little too much…
(Sources: House Natural Resources Committee and US Treasury)