WASHINGTON — Democrats in the US Senate on Tuesday proposed eliminating tax breaks for big oil firms and applying the expected $21 billion savings over 10 years to help reduce the deficit.
“We all need to tighten our belts to help address the deficit, even the oil companies,” said Senator Robert Menendez of New Jersey. “But sometimes it’s hard to understand the true scale of their wealth.
“Each of the big five oil companies are on average going to make $25 billion this year.”
The bill is aimed at the world’s five largest oil firms: ExxonMobil, the Anglo-Dutch firm Shell, BP of Britain, Chevron and ConocoPhillips.
Menendez called “pretty ridiculous” the claim by opposition Republicans that removing the tax deductions and credits would lead to higher gasoline prices at the pump.
One gallon (3.8 liters) of gasoline now costs more than $4 a gallon in the United States, around a dollar a liter.
The proposed bill would eliminate a provision that allows companies to enjoy tax deductions on income from their overseas operations.
Menendez, along with Senators Sherrod Brown of Ohio and Claire McCaskill of Missouri, produced a bar graph they said would have placed the revenues for the big five oil companies at a height of 19 miles (30 kilometers) compared to a few inches (centimeters) for an average American household.
The three senators noted that their proposal would shave a total of $2 billion annually from the oil revenues of the five companies.
“If we cannot end subsidies to the five biggest, most profitable corporations in the history of the planet… then I don’t think anyone should take us seriously about deficit reduction,” said McCaskill.
“If we can’t do this… then I don’t know if we can ever get to the really difficult work that lies ahead.”
The senators said they hoped to have the support of Senate Democratic leader Harry Reid, as well as a handful of Republican senators.