March 3 2008

One News Now: Taxes on oil

Carrie L. Lukas

Economic analyst Carrie Lukas says a bill approved by the U.S. House that includes $18 billion in new taxes on the largest oil companies would only further drive up the cost of gasoline at the pump and make America's energy problems worse.

Democrats says the billions collected from raising taxes on oil would provide necessary tax breaks for wind, solar, and alternative energy sources. But House Minority Leader John Boehner (R-Ohio) scoffed at the measure, saying the Democratic majority chose tax breaks for Venezuelan dictator Hugo Chavez over tax cuts for middle-class families. Democrats rejected a GOP proposal that would permanently end the marriage penalty and keep the child tax credit intact.
 
Carrie Lukas, vice president for policy and economics at the Independent Women's Forum (IWF), a Washington, DC-based conservative think tank, argues the new taxes on oil companies discourage domestic energy production. "That's really not the direction that America wants to go when we have these demands for energy and really high costs," she attests.
 
Lukas says alternative fuels have a role to play, but the government needs to stop funding politically correct ones and let entrepreneurs decide what sources are the most efficient. "The government needs to stop trying to punish oil and gas companies and instead get out of their way so that they can start developing and finding new sources of energy to bring [down] some of these prices we face ...," says the IWF spokeswoman.
 
In addition, Lukas argues that America does not need new energy taxes. "When you add a tax, when you make something more expensive, that's going to passed on to the consumer," she points out.
 
"The simple fact is [that] when our gas prices go up, it's because of a scarcity of oil and gasoline," she continues. "So we don't want to make it worse [and] make it more expensive by taxing it; we need to find new ways, make it easier for gas and oil to come into the marketplace. Really, what we need the government to do is to get out of the way and stop trying to pick winners and losers."
 
Lukas says she is all for eliminating tax loopholes, but that it must be done in the context of comprehensive tax reform. She notes the U.S. has one of the highest corporate tax rates in the world, which puts domestic companies at a significant disadvantage.

Comments
blog comments powered by Disqus