Newspaper article The Christian Science Monitor

Senate Blocks Big Oil Windfall Profits Tax Bill

Newspaper article The Christian Science Monitor

Senate Blocks Big Oil Windfall Profits Tax Bill

Article excerpt

Senate Republicans today voted to block an energy bill that would have imposed a windfall profits tax and ended $17 billion in tax breaks for oil companies.

At a time of record high gasoline prices, the issue of which party is doing the most to ease the impact on American families is eclipsing all other issues as a top political concern. Lawmakers on both sides of the aisle say they expect such high-profile votes on the issue to continue until the fall election.

"Today, Republicans will have a simple choice: Will they continue to stand with [President] Bush, [Vice President] Cheney, and the modern-day oil barons? Or will they join us on the side of struggling American families who deserve better?" Senate majority leader Harry Reid said before the Tuesday morning vote.

Since Mr. Bush came to office in 2001, gasoline prices have more than doubled and oil companies have made more than half a trillion dollars in profits, Democrats say.

The proposed Consumer-First Energy Act would create a 25 percent windfall profits tax on companies that don't invest in renewable fuels or electricity production. It also would zero out some $17 billion in tax breaks for the oil industry and use the revenue to help consumers by investing in an Energy Independence and Security Trust Fund. The bill aims to curb speculation by hiking up margin requirements for those investing in futures trades and banning traders from using offshore futures markets to evade regulation.

On Tuesday, Bush threatened to veto the bill: An increase in taxes on energy will likely reduce supply and increase energy costs, he said. It's "exactly the opposite of what the Congress should be doing at a time when consumers are already burdened with record high energy prices," he said in a statement issued by the Office of Management and Budget. …

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