Fuel relief proposals abound in Congress

| Friday, April 28, 2006

Perhaps spurred by the fact that this is an election year, it seems nearly everyone in Congress has come up with an idea on how to help people deal with the rising cost of fuel.

The National Journal reported that Rep. Jim McDermott, D-WA, was planning to introduce legislation on Thursday, April 27, that would repeal a manufacturing deduction enacted in 2004 that lowered taxes for U.S. producers, including oil and gas companies.

Not to be outdone, Republican lawmakers have proposed a $100 rebate for every taxpayer to help offset rising fuel costs, though no details were released as to exactly how that would be funded. That measure also includes a controversial proposal to begin drilling for oil in Alaska’s Arctic National Wildlife Refuge, a move that has failed in the past.

Earlier this week, another Democrat, Sen. Bob Menendez, D-NJ, proposed a 60-day fuel tax holiday on both gasoline and diesel.

As if all of that weren’t enough, The Associated Press reported that the Senate Finance Committee has requested tax records for the major oil and gas companies as part of an investigation into soaring profits and fuel prices.

The AP reported that the request for tax records was highly unusual and that the last time it was done was during the investigation of Enron Corp.

For its part, the oil industry has been on the defensive about accusations of price fixing. In an e-mail to “Land Line Now,” an ExxonMobil spokesman said “ExxonMobil does not and could not control the market price of gasoline.”

The e-mail stated that, while there are about 13,000 ExxonMobil fueling stations in the U.S., ExxonMobil itself only owns and operates 1,000 of them. The rest are operated by independent distributors.

In addition, the e-mail said that the biggest influences on oil and fuel prices “continues to be demand and supply for crude oil and petroleum products and local supply and demand for (fuel), followed by federal and state taxes.”

– By Terry Scruton, senior writer
terry_scruton@landlinemag.com
Reporter Reed Black of “Land Line Now” contributed to this article.

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