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economic justice | energy & nuclear

Kucinich: Tax Windfall Profits of Oil Companies

Front page today at the kucinich website

 http://www.kucinich.us/

"What more do we need to know about the rising price of gasoline? Profits are soaring to all time highs while oil companies raise prices with impunity. Oil runs the White House, puts us into war, runs geopolitics, frustrates the development of alternative energy, ruins the environment. What will it take for the Congress to wake up? $5 a gallon?"

"There is a short term, effective solution: The Gas Price Spike Act of 2005. This bill exacts a 100% windfall profits tax on oil companies on excessive profits. The money gained from the windfall profits tax would be put into a fund for tax breaks for the purchase of ultra-efficient vehicles made in the US. Money would also be made available for mass transit assistance."

"Only a 100% windfall profits tax will cause the oil companies to stop their aggressive pricing which is destroying the budgets of millions of American families. I need your help to wake up the Congress and pass this legislation."
On May 4, Congressman Kucinich and 33 cosponsors introduced in the House of Representatives H.R. 2070, the Gas Price Spike Act of 2005. The Bill has been referred to the House Ways and Means Committee and to the House Transportation and Infrastructure Committee.

This bill, if passed, provides tax benefit for purchasers of high efficiency American-made cars and subsidies for mass transit

This legislation provides for a windfall profit tax on oil and natural gas (and products thereof), allows an income tax credit for purchases of fuel-efficient passenger vehicles made in the United States, and provides grants for operators of mass transit systems to lower fares during gas price spikes.

_____________

Oil companies should not profit excessively from the increasing scarcity of our natural resources

Windfall profits are profits due to outside circumstances - not directly under the control of the energy company - which exceed a reasonable profit level, to be established by an appointed board whose members have no financial interest in any of the affected companies.

The windfall profits tax on oil companies would be:

* Half of the profit between 100% and 102% of what's determined to be reasonable; and
* Three-quarters of the profit between 102% and 105% of the reasonable level; and
* All of the profit which is 105% or more of the reasonable level.
______________

Cleaner and more efficient cars, American jobs and money in the bank

To qualify for a tax credit, a vehicle would need to be a new car, truck or sport-utility vehicle (SUV) purchased for non-business use and assembled in the United States by workers employed under a collective bargaining agreement which gets at least 45 miles per gallon (MPG) of fuel (35 MPG for trucks and SUVs).

The tax credit allowed per taxpayer per year would be:

* $6,000 for cars getting 65 MPG or more (trucks/SUVs 55 MPG plus), or
* $4,500 for cars getting 55 MPG or more (trucks/SUVs 45 MPG plus), or
* $3,000 for cars getting 45 MPG or more (trucks/SUVs 35 MPG plus).

These would not be deductions, but credits off the bottom line income tax of purchasers.
____________

Mass transit needs to be easier and cheaper

Fare reductions would need to be applied equally to all passengers using a mass transit system. Grants would be funded by revenue from the windfall profits tax on oil and gas companies, to the extent that revenue remains after funding of tax credits for purchasers of fuel-efficient vehicles.
_____________

We have prepared resources to assist you in doing all you can to help to get this Bill passed:

LINKS AVAILABLE AT KUCINICH WEBSITE:

* Review Bill progress and cosponsors
* Ask your Member of Congress to cosponsor (if not already)
* Talking points, committee members to contact
* Record the responses you get from members of Ways and Means and Transportation / Infrastructure
* Share resources on fuel costs, mass transit systems, and fuel-efficient vehicles.
* Comment or ask questions

 link to www.kucinich.us
sound 17.Sep.2005 19:37

plan

here we have the most reasonable idea to come out of the congress in a quite a while--a win-fall tax on the robber barons. and yet, we all know that there isn't the slightest hope of ever having this proposal enacted into law; because both a significant majority of the members of both parties is deeply indebted to the big oil boys...and they will never agree to give up a single dime of their gross profits...so it's going to take a real revolt to tame the beast, i'm afraid.

Windfall profits tax? 17.Sep.2005 20:34

007

Nothing like killing the goose that laid the golden egg, is there.

You have no idea just how lucky you pinheads are. You have the lowest energy prices in the free world and you still continue to bitch.

If oil had kept up with inflation, a barrel would be about $93. This would put a gallon of gas at around $4.00 +/-.

A few days ago I spoke with a fellow who remembered when oil was $8 a barrel. Gas was $1+. At $64 a barrel oil should be about $6+ per gallon. Maybe the companies should charge O, say $9 and see how you like paying the rate of inflation.

Count you lucky stars you live in America and not Europe where they pay close to $8 per gallon.

ah, 18.Sep.2005 00:19

have another look 007

this proposal is for a "win-fall tax", which is, if don't know, a one-off tax to be paid only after all operating costs are met and a reasonable profit is recouped.

what we are witnessing in the oil industry right now is not a goose laying a golden egg but rather a goosing of the masses gold on a level unseen since the gilded age.

put simply, the big oil boys are profiting excessively and making out like robber barons. in doing this, they are sopping up liquidity as profit; and, in so doing, they are starting to depress the consumer economy, which is where the real concern should be.

now, as for the relative difference in gasoline costs between europe and america, that can be explained by the differing taxation regimes, one of which pays for universal health-care and a decent education for all its citizens, the other of which does not even come close. that is not to say, however, that the same oil monopolists are not bilking the masses any less in one place than they are in the other.

if you have trouble grasping the need to mitigate against excessive profiteering via state taxation, then have another look at how those under-funded public levees in NOLa worked out for everyone.

The golden egg. 18.Sep.2005 09:45

007

Your windfall profit tax cost this nation about 250,000 stripper well back in the 80's pinhead. They produced (past tense) about what we import from SA. That is one BIG reason our imports increasd

Energy is the universal engine 18.Sep.2005 19:18

driving all economies

Much of the energy resources in the US(coal, oil, natural gas) come from public lands leased to the robber barons. The citizens of the US should pay less for energy costs because the resources belong to the people of the US. This concept should not be forgotten in America, as well as, other oil producing nations. In European counties, that have no native sources of cheap energy they elect to use nuclear energy, like France, for cheap energy. Other places such as Portugal and Spain are investing in wind and solar technology for their cheap energy. Energy costs if allowed to spiral out of control will impoverish the peoples of that Nation. It is foolhardy to think otherwise. Conservation is important but only as one facet in a complex infrastructure.

oo7 18.Sep.2005 23:38

what do you mean by

"stripper"?

--is that some sort of veiled reference to the last new oil refinery built in the u.s. circa 1972?

--or, are you trying to draw attention to the fact that the production of texas sweet light-crude peaked in 1975 and has been in deline ever since?

--or, perhaps you're getting at the perennial dearth of corporate tax revenues which has precipitated the steady decline in homeland infrastructure from the reagan revolution onwards?

--or, maybe you mean to say that all of the corporate profiteering in the oil industry in america has pared down capital investment to the point where the homeland has been virtually hollowed out and thus rendered unable to adjust to the future shocks through which we are now living?

--why don't you tell us all what it is?

--and, by the way, what's with the ad hominum attacks? i mean, surely you can do better than calling a total stranger "pinhead", no?

Windfall profits tax is no solution 27.Oct.2005 06:08

Thomas E. Worthen

These Congressmen just don't understand the world energy situation. If they will just look at the earning details of Conocophillips, the 3rd largest domestic energy company, they will find after paying 43% taxes on their gross profits, their is over 75% of the profits going to find and develop more energy. Who would these lawmakers decide has the savy to know what is a fair profit? Do they tell the drug companies what is a fair profit on their patented drugs? Do these lawmakers tell Intell or Microsoft what is a fair profit? We now have a mechanism in the capitalist system that works in the longer run when governments do not tamper with it.
A windfall oil profits tax will create a real energy shortage and that government managed econommy has not worked for the benefit of the public. Wake-up America!

A Winfall Profit tax would only benefit the Big Oil Companies and Politicians. 07.Jan.2006 22:31

Aaron K. Washington, USMC Vietnam Era Veteran aaron_washington@hotmail.com

There is so much "b*llsh*t" coming out of Washington, D.C. from most of our politicians, it sickens me. The American consumer is paying dearly, because of their greed. Big Oil and politicians profitted during this diaster. They all should go to jail. They have all committed fraud, and lt is millions, even billions of times worst than that committed by Enron.

The politicians are all afraid of those in power, and fear death from those that speak out against those abusing the trust of the American people. A forgotten senator and his entire family was silenced, because he chose to speak out and inform the People. A lot more than he was silenced, (the entire Democratic Party). Those in power are overtly breaking the law and violating all aspects of the United States Constition, with no recourse nor remorse. Just look a candid look at the State of the Union, the worst, ever. Big brother is watching a every intersection, and listening to every telephone conversation. Remember, the is the same thing that caused World War II.

The greed of those in power is running unchecked. Just take a look:
(1) Fixed elections; (2) The killing of American citizens masked as terrorist attacks; (3) The looting of the U.S. Treasury; (4) The imprisonment of American citizens without due process; (5) the suspension of protection under the U.S. Constitution; (6) The use the a Military agency to spy on citizen in the United States; (7) The wars in the Middle East; and on and on and on. If the people speak out, gas proces go up and we face a terrorist threat. Even if we try to vote them out, it won't happen. Remember the elections are fixed. As a People we are f*cked.