[Congressional Record Volume 158, Number 15 (Tuesday, January 31, 2012)]
[Extensions of Remarks]
[Page E97]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




 INTRODUCTION OF A BILL TO AMEND THE INTERNAL REVENUE CODE OF 1986 TO 
  DISALLOW A DEDUCTION FOR AMOUNTS PAID OR INCURRED BY A RESPONSIBLE 
                  PARTY RELATING TO A DISCHARGE OF OIL

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                         HON. ALCEE L. HASTINGS

                               of florida

                    in the house of representatives

                       Tuesday, January 31, 2012

  Mr. HASTINGS of Florida. Mr. Speaker, today Exxon announced annual 
earnings of $41.1 billion, a 35 percent increase from the previous 
year. Recently, ConocoPhillips announced $12.4 billion profits for 
2011. Chevron's earnings for the year also rose 41 percent to $26.9 
billion. These enormous figures indicate that these global corporations 
no longer need charity from the United States government. For this 
reason, I rise today to introduce a bill that has been needed at least 
since the Exxon Valdez spilled 750,000 barrels of oil into Prince 
William Sound. My bill closes a loophole that permits these big oil 
companies to pad their bottom lines with tax deductions for cleaning up 
their oil spills. While the high price of gasoline continues to burden 
American families, oil companies are raking in such huge profits. Why 
should the American taxpayer pay for what the oil companies are 
supposed to do anyway?
  Through clever accounting, a big oil company can actually deduct from 
its tax liability the money it spends cleaning up after an oil spill as 
an ``ordinary cost of doing business.'' These big oil companies used to 
pay their fair share of taxes on their massive profits. Corporate taxes 
used to account for 40 percent of Federal revenues, but that now has 
fallen to around 7 percent, with many companies paying no taxes at all. 
At the same time that families, as well as Federal, State and local 
governments, are tightening their budgets, we're letting big oil and 
gas companies profit from valuable tax revenue that they don't deserve.
  The Joint Committee on Taxation estimates that closing this loophole 
in the tax code will save the American taxpayer an average $1.3 billion 
per year. With massive cuts to hundreds of essential programs and 
organizations dedicated to ensuring access to education, affordable 
health care, homeownership assistance, unemployment insurance, veterans 
benefits, loans for small businesses, food assistance to prevent 
hunger, support for farmers growing essential crops, and a middle class 
that is struggling more than ever, that billion dollars per year would 
ensure that these programs are not losing tax dollars because 
exceedingly wealthy companies are reaping the benefits. By eliminating 
a loophole that lets the largest oil and gas companies benefit from 
their own mistakes, this bill makes the tax code fair again for 
hardworking Americans and will put our country on track to develop a 
clean, sustainable, and sensible energy policy.
  These tax dollars are not lost only when there's a rare catastrophic 
spill like the BP Deepwater Horizon or Exxon Valdez. In fact, oil 
spills happen all the time and oil companies can just write off the 
costs. Right now, there's a Chevron gas rig blowout burning at 1400 
degrees Fahrenheit off the coast of Nigeria that Chevron has been 
unable to extinguish for over a week. Two people are dead and there is 
a sheen in the water. There were also recent blowouts at the Macondo 
well in the Gulf, the Montara well in the Timor Sea, as well as major 
accidents and spills in Bohai Bay, China and off the coast of Brazil.
  I believe the tax code should reflect our country's need to end our 
reliance on fossil fuels by discouraging blowouts and oil spills and 
providing incentives for responsible and efficient energy use, and 
sustainable, clean energy sources.
  We can no longer afford a 20th century energy policy when the rest of 
the world is well into the 21g century. From the Keystone pipeline 
debate to subsidies for oil and gas companies, our antiquated energy 
policy is reflected in our outdated tax code containing many provisions 
that have long since outgrown their usefulness. My bill will put our 
country on the right track.
  Finally, Mr. Speaker, the Internal Revenue Service (IRS) defines an 
``ordinary business expense'' as a cost that is both ordinary and 
necessary. Why are we allowing the cost of an oil spill to be treated 
as ordinary as purchasing a stapler or paying a phone bill? An oil 
spill should not be ordinary. From a fiscal standpoint, from a policy 
standpoint, and from a moral standpoint, even a small oil spill is an 
extraordinary and terrible mistake with far-reaching consequences. Oil 
and gas corporations should not be allowed to benefit from their own 
extraordinary mistakes at the expense of the American taxpayer.
  I urge my colleagues to support a 21st century energy policy, and a 
sensible tax code by supporting this bill.

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