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Senate GOP stops oil, energy windfall taxes

By Associated Press
Published November 18, 2005

WASHINGTON - Senate Republicans beat back Democratic attempts Thursday to use a $60-billion tax bill to pinch oil and energy companies that have been reporting record profits while consumers pay high gasoline prices.

The bill, which would prevent a number of individual and business tax breaks from expiring, already levies more than $4-billion in taxes on major oil companies.

The energy amendments faced opposition from the Republican majority and stood little chance of success. But they reflected attentiveness on Capitol Hill to high gasoline prices and fears of skyrocketing home heating costs.

Some GOP senators and the White House were unhappy because the bill included a change in accounting methods that would hit the largest integrated oil companies with $4.3-billion in taxes. The provision drew a veto threat from the Bush administration. Lawmakers were alarmed when five major companies and their global parent corporations earned more than $32.8-billion in the July to September quarter.

Consumers saw gasoline prices soar beyond $3 a gallon in the aftermath of supply disruptions caused by hurricanes, and the politicians called on oil executives to explain their huge profits.

Democratic Sens. Byron Dorgan of North Dakota and Chris Dodd of Connecticut lost a bid to impose a temporary windfall profits tax of 50 percent on the sale of oil over $40 a barrel, applied to profits not reinvested in increasing domestic oil and gas supplies. They would have returned the money to energy consumers through an income tax rebate. A 64-35 procedural vote defeated it.

A similar amendment sought to impose a temporary windfall profits tax on oil companies and use the money to fund a low-income heating assistance program.

[Last modified November 18, 2005, 01:29:09]

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