Today, Representatives Gene Green (TX-29) and Harry Teague (NM-02), along with 17 Democratic colleagues, sent a letter to Chairman John Spratt (SC-05) of the House Budget Committee urging the committee not to include the President's proposed oil and gas tax increases within the congressional budget.
The tax repeals proposed in the President's Fiscal Year 2011 budget would discourage energy companies from new investments in additional projects and jobs while disproportionately penalizing America's small, independent producers. Among the proposed tax repeals essential to the energy industry include: Intangible Drilling and Development Costs (IDCs), Percentage Depletion, Enhanced Oil Recovery (EOR) Tax Credit, Passive Loss Exception for Working Interests in Oil and Gas Properties, Geological and Geophysical (G&G) Amortization, Marginal Well Tax Credit, and the Manufacturing Tax Deduction.
"The natural gas and oil industry is a staple of the American economy and essential in securing our energy independence," Rep. Green stated. "Repealing these tax provisions would put an entire industry at risk; stepping backward at best and fatally wounding it at worst."
Repealing each of these provisions would strip over $35 billion in capital from exploration and production projects in the U.S. According to the letter, "the continued domestic production of natural gas and oil will help address many of the challenges we face today, including create jobs for a struggling economy, provide millions of dollars to federal and state governments from taxes and royalties, decrease our reliance on foreign sources of energy, and meet our clean energy goals by reducing greenhouse gas emissions."
"Over the past year, President Obama and the Democratic Congress have made job creation and economic improvement the top priority and we've made great strides forward," Rep. Green added. "Many of America's energy producers qualify as small businesses and are just as vulnerable to the state of the economy as anyone else. We need to make all American industries' viability and growth our concern."