US Senate Blocks Bill to End Tax Breaks for Transnational Oil Corporations

US imperialism and its allies are bombing North Africa everyday in an effort to destroy the oil-producing state of Libya., a photo by Pan-African News Wire File Photos on Flickr.

Senate blocks bill to end tax breaks for Big Oil

Jennifer A. Dlouhy, Hearst Washington Bureau
Tuesday, May 17, 2011
(05-17) 04:00 PDT Washington --

Democrats' bid to raise $21 billion over the next 10 years by hiking taxes for the nation's five biggest oil companies failed a key procedural vote in the Senate on Tuesday - but the issue isn't going away anytime soon.

The subject is already fodder for political ads that paint Republicans as Big Oil allies who are out of touch with ordinary Americans suffering amid high gasoline prices.

Democratic leaders vowed Tuesday that a final deal to raise the nation's debt ceiling this summer would include a repeal of tax breaks claimed by the big five oil companies.

"I am confident that before we finish our budget negotiations here in anticipation of raising the debt ceiling, that that will be a part of it," said Senate Majority Leader Harry Reid, D-Nev.

The measure failed to overcome a procedural hurdle Tuesday when the Senate voted 52-48 to block consideration of the tax-break bill - eight votes shy of the 60 that were needed to allow debate.

Two Republicans - Sens. Susan Collins and Olympia Snowe of Maine - broke party ranks to vote for the legislation. Democrats Mary Landrieu of Louisiana, Mark Begich of Alaska and Ben Nelson of Nebraska crossed party lines to vote against the measure.

The bill, sponsored by Sen. Robert Menendez, D-N.J., would block the top five largest oil companies from claiming a tax credit on payments to foreign governments, as well as a domestic manufacturing deduction that has generally been available to a broad range of U.S. industries.

It also would bar the companies from claiming other tax breaks, including a deduction of intangible drilling costs, such as the cost of repairs, site preparation and hauling supplies.

President Obama has asked for similar, industrywide tax changes before, but Menendez's proposal gained steam amid mounting anger over high gasoline prices and the five top oil companies' near-record first-quarter profit of more than $35 billion.

http://sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/05/17/MNJU1JHEL7.DTL

This article appeared on page A - 4 of the San Francisco Chronicle