Democrats Seek Special Tax on Oil Profits

Democrats in the US Senate yesterday called for a temporary special tax on oil companies’ profits and a rollback of $17 billion in oil industry tax breaks as part of an energy package.

The proposed 25 percent profits tax would apply just to oil company earnings above what would be considered “reasonable” and only if those profits are not reinvested in expanding refinery capacity or renewable energy sources.

Not surprisingly, Senate Republicans strongly oppose any additional oil industry taxes, which are widely viewed as unlikely to be enacted and would almost certainly prompt a veto by President Bush. The Democratic leader, Harry Reid of Nevada, said Republicans offered “more of the same failed energy policies that brought us to this point.”

All the makings of another political stalemate…