[Congressional Record Volume 155, Number 78 (Wednesday, May 20, 2009)]
[Senate]
[Pages S5703-S5704]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. KERRY:
  S. 1087. A bill to amend the Internal Revenue Code of 1986 to repeal 
certain tax incentives related to oil and gas; to the Committee on 
Finance.
  Mr. KERRY. Mr. President, today I am introducing the Energy Fairness 
for America Act which repeals tax incentives for the oil and gas 
industry. This is the third consecutive Congress in which I have 
introduced this legislation. Some of the provisions of prior versions 
of my legislations were enacted last year, but more can be done. At a 
time when we are trying to incentivize clean energy, we should not 
continue to provide unnecessary tax incentives to the oil and gas 
industry.
  The Energy Fairness for America Act would repeal the section 199 
manufacturing deduction for income attributable to domestic production 
of oil and gas. The domestic manufacturing deduction was designed to 
replace export-related tax benefits that were successfully challenged 
by the European Union. Producers of oil and gas did not benefit from 
this tax break. Initial legislation proposed to address the repeal of 
the export-related tax benefits and to replace them with a new domestic 
manufacturing deduction. That legislation only provided the deduction 
to industries that benefited from the export-related tax benefits. 
However, the final product extended the deduction to include the oil 
and gas industry as well.
  The tax code provides numerous other preferences to the oil and gas 
industry. This legislation would repeal provisions that do not promote 
low-carbon energy sources and further our addiction to oil. The Energy 
Fairness

[[Page S5704]]

for America Act would repeal the credit for the crude oil and natural 
gas produced from marginal wells, expensing of intangible drilling 
costs and 60-month amortization and capitalized intangible drilling 
costs, exception from the passive loss rules for working interests in 
oil and gas properties, and percentage depletion for oil and gas wells. 
In addition, it would increase the amortization period from two years 
to seven years for geological and geophysical expenditures incurred by 
independent producers in connection with oil and gas exploration in the 
U.S.
  This legislation will help align our tax code with our broader energy 
goals. Our focus should be on lowering carbon emissions and encouraging 
renewable energy sources, not rewarding the oil and gas industry. I 
urge my colleagues to join me in eliminating these unnecessary tax 
breaks.
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