On June 30, 2010, Congressman Earl Blumenauer (D-OR) introduced the End Big Oil Tax Subsidies Act to cut a number of subsidies for big oil and gas companies. Blumenauer estimates a savings of $30 billion for taxpayers over the next five years. Highlights of the bill include eliminating credit for wells producing limited quantities of higher cost oil and gas, removing a 15% credit for the cost of extracting oil using certain technologies, eliminating the tax deduction for companies manufacturing domestically, and ridding of other subsidies and tax exemptions. Senators Robert Menendez (D-CA), Jeff Merkley (D-OR), and Bill Nelson (D-FL) also proposed similar legislation to get rid of tax cuts and subsidies for big oil companies. Among its proposals are a reform of foreign tax laws to prevent companies from skipping out on certain taxes, and a tax requirement for extraction from the Gulf of Mexico.

Both bills are a step in the right direction to stop padding the pockets of outrageously profitable oil companies with federal giveaways. From 2005-2009, profits for the biggest oil companies amounted to $559 billion. That’s a number that needs no additional help from taxpayer backed subsidies. It’s time that Congress takes serious action to eliminate tax cuts and subsidies for the oil and gas industry.