March 8, 2012

Big Oil and Tax Breaks

By Randall Hoven
To hear the president and Democrats talk, you'd think that Big Oil was sucking the Treasury dry with huge subsidies.  Almost a year ago I wrote about the federal government's "subsidies" to Big Oil.  I said then, "They are all tax 'breaks'... about $4.3 billion per year -- about 0.2% of this year's deficit and enough to fund about 10 hours of current US government spending." I was wrong.  The tax breaks for all fossil fuels was not $4.3B in 2011.  It was only $2.5B -- about 0.19% of that year's deficit, and enough to fund only six hours of U.S. government spending.  The source for such heresy?  The Congressional Budget Office. Just to be clear, that $2.5B was not just for Big Oil, but also for Big Coal and Big Gas: all fossil fuels.  Here, more exactly, are those subsidies, in the CBO's words. "Expensing of exploration and development costs for oil and natural gas." ($0.8B) "Option to expense 50% of qualified property used to refine liquid fuels."...(Read Full Article)