On the House floor, Rep. Eliot Engel (D-N.Y.) just said he will introduce legislation that would prevent oil companies from claiming a tax deduction for oil spill expenses. Engel did not give details on the legislation
This seems fair. That's a rather large expense charge. It wouldn't be hard for BP to reclassify some fines and penalties as expenses due to cleanup. A full audit of that $32 billion expense isn't a problem. Remember, the larger an account, the easier it is to hide things in. If I was BP, I'd figure out the limit of materiality and then start reclassifying non-deductible fines and penalties into clean up expenses right under that limit. And with BP's asset size, immaterial amounts are quite large.Senator Bill Nelson said he wants a probe into whether BP, which announced on Tuesday a $32 billion charge linked to the clean-up, will be deducting legal expenses related to nondeductible fines and penalties, and whether BP should deduct the full cost of its $20 billion cleanup fund.
"If your opponent is of choleric temperament, seek to irritate him." - Sun Tzu
Last edited by upsideguy; 07-31-10 at 06:19 PM.