Yarmuth calls for ending oil subsidies and giving that cash back to consumers
03/19/2012 01:37 PM
Washington Democrats are taking a populist preemptive strike on an issue sure to come up in the presidential election – energy production.
With Republicans criticizing President Obama for restricting domestic oil drilling, Democrats led by Louisville’s U.S. Rep. John Yarmuth are calling for ending federal tax subsidies for oil companies and, instead, directing the money to come back to consumers.
Yarmuth announced Monday he would introduce legislation to end federal subsidies to oil companies and return nearly $4 billion-a-year to consumers through targeted gas rebates.
That comes less than 48-hours after the president used his weekly video address to call for the end of tax breaks for oil companies and to develop alternative sources of energy.
The oil industry is slated to receive about $38.6 billion in federal subsidies over the next 10-years, Yarmuth said. Kentucky’s portion of those funds would be more than $564 million.
The legislation would instruct the IRS and the Secretary of the Treasury to work with states to distribute rebates to individuals and businesses for each vehicle they own or lease for more than one year. Based on the 242 million registered vehicles, the resulting rebate would be about $160 per vehicle.
Congressman Yarmuth drove home his pitch to end oil subsidies with a quote from former President George W. Bush, who in 2005 said, “I will tell you with $55 oil we don’t need incentives to the oil and gas companies to explore. There are plenty of incentives.”
The price per barrel of crude oil last week was around $107 a barrel. Since 2005, oil companies have received nearly $300 billion in tax breaks. But, as an Associated Press story out of Washington noted, Democrats couldn’t pass a similar bill when they controlled both chambers.
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