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Senate blocks bill repealing $2 billion in oil tax breaks

liblady said:
Senate blocks bill repealing $2B in oil tax breaks - Politics - Capitol Hill - msnbc.com



why? why? why do we give companies with record profits tax breaks, especially now?
how can the people who voted against this bill, in good conscience, suggest we cut, say, head start programs and food stamps?
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As pointed out in another thread 3 of the 4 tax breaks, not subsidies but tax breaks, are for all businesses in the U.S.

Why are oil companies being targeted for tax deductions when all other businesses get to take them?
 
Harry Guerrilla said:
As pointed out in another thread 3 of the 4 tax breaks, not subsidies but tax breaks, are for all businesses in the U.S.

Why are oil companies being targeted for tax deductions when all other businesses get to take them?
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i didn't know that. which thread?
 
Harry Guerrilla said:
http://www.debatepolitics.com/break...oil-subsidies-defeated-10.html#post1059494170

News stories have become jokes.
They rarely tell the whole story behind things like this.
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according to your source, this is only part of the bill....and it comes down to semantics. i believe that we are subsidizing the oil companies.

Typically, U.S.-based companies are required to pay taxes on all income they earn globally. Companies then receive U.S. tax credits for payments to other governments so they aren’t taxed twice on the same income.

The dual-capacity rules, as currently written, create a distinction between income taxes levied on profits and royalties that companies pay when they extract government-owned oil and gas. Royalties can be taken as tax deductions, not as more valuable tax credits. “Dual capacity” refers to the fact that companies pay taxes to other governments for multiple purposes.

“U.S. oil and gas companies have smart lawyers and accountants, and they have figured out that if you can convince foreign governments such as Nigeria to charge your taxes -- to charge you taxes instead of royalties on your exploration, then they can get a big break on U.S. taxes,” Senator Robert Menendez, a New Jersey Democrat, said May 10 at a news conference in Washington. “This amounts to the U.S. government subsidizing foreign oil production.”
 
liblady said:
according to your source, this is only part of the bill....and it comes down to semantics. i believe that we are subsidizing the oil companies.

Typically, U.S.-based companies are required to pay taxes on all income they earn globally. Companies then receive U.S. tax credits for payments to other governments so they aren’t taxed twice on the same income.

The dual-capacity rules, as currently written, create a distinction between income taxes levied on profits and royalties that companies pay when they extract government-owned oil and gas. Royalties can be taken as tax deductions, not as more valuable tax credits. “Dual capacity” refers to the fact that companies pay taxes to other governments for multiple purposes.

“U.S. oil and gas companies have smart lawyers and accountants, and they have figured out that if you can convince foreign governments such as Nigeria to charge your taxes -- to charge you taxes instead of royalties on your exploration, then they can get a big break on U.S. taxes,” Senator Robert Menendez, a New Jersey Democrat, said May 10 at a news conference in Washington. “This amounts to the U.S. government subsidizing foreign oil production.”
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A subsidy is the government giving someone money from the government coffers to support their business.
A tax break is allowing a business to keep more of the money they earned.

Sure there are clever accounting procedures, but that isn't left to only the oil companies.
All businesses do this in some form or another.

Want to see the worst offenders, check out small businesses and how many of them fraudulently claim business expenses, that they never incurred.
 
MrVicchio said:
Silly man, companies don't pay taxes, the consumers of their products do with higher costs. Unless you believe in price controls too...
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Increases in on a business' income tax do not affect the prices of its products.

Silly conservatives need to go to school and learn ECON instead of getting their "education" from rush and/or palin.
 
liblady said:
Senate blocks bill repealing $2B in oil tax breaks - Politics - Capitol Hill - msnbc.com



why? why? why do we give companies with record profits tax breaks, especially now?
how can the people who voted against this bill, in good conscience, suggest we cut, say, head start programs and food stamps?
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You do realize that it would not be the oil companies paying that 2billion in taxes if those cuts were repealed? It would we the consumers because taxes just like the cost of equipment,goods, labor and anything else that a company has to spend in order to make or produce something gets passed down to the consumer.
 
solletica said:
Increases in on a business' income tax do not affect the prices of its products.
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Why would a business not do this? They do it when the cost of equipment,labor supplies and any else required for their business goes up.Its like that lawsuit against big tobacco many years ago,big tobacco didn't pay ****.The smokers helped pay for it and since at the time big tobacco owned Kraft and many other food brands non-smokers also helped pay for that lawsuit.

Silly conservatives need to go to school and learn ECON instead of getting their "education" from rush and/or palin.
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Silly libs need know what a profit margin is and how businesses are ran.
 
jamesrage said:
Why would a business not do this? They do it when the cost of equipment,labor supplies and any else required for their business goes up.Its like that lawsuit against big tobacco many years ago,big tobacco didn't pay ****.The smokers helped pay for it and since at the time big tobacco owned Kraft and many other food brands non-smokers also helped pay for that lawsuit.



Silly libs need know what a profit margin is and how businesses are ran.
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If they did, they wouldn't be libs on such issues. ;)

.
 
TOJ said:
If they did, they wouldn't be libs on such issues. ;)

.
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Libs understand economics. Right wingers understand what rush limbaugh tells them.
 
solletica said:
You -> School -> Microeconomics

They will teach you.
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The thing is a school class does not equal real business. Taxes are one of the costs of doing business just like cost of supplies,transportation,employees and many other things a business needs in order to produce goods and or services. You would have to a be a ****en moron to think that no business is passing on those costs onto the consumer,especially companies with a very low net profit margin.

Oil Industry Profit Margin Ranks Fairly Low: There Are Bigger Fish - Seeking Alpha
114 Major Integrated Oil and Gas 6.2%


Libs understand economics. Right wingers understand what rush limbaugh tells them.
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I seriously doubt that people who spew the mantra of lets tax the **** out of the rich and lets bleed a company to death for benefits somehow have any understanding of economics.
 
solletica said:
Increases in on a business' income tax do not affect the prices of its products.

Silly conservatives need to go to school and learn ECON instead of getting their "education" from rush and/or palin.
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I'm not.

Taxes are a cost to business. The higher the tax increase, the more it hurts the profit margin, the more the effect ripples out. Be it higher priced goods, laid off employees, less investment into the business (that would purchase of new equipment, or expansion of existing)...

Taxes are an artificial cost placed on businesses, and like ANY cost, it has consequences.
 
Republicans have never seen a corporate welfare bill that they haven't loved.
 
Zyphlin said:
Are we talking about subsidies or tax breaks? I agree, we shouldn't be providing financial assistance to oil companies, I agree with you there. But to me that's significantly different then charging them less in taxes or, as one poster stated and if its true, attempting to tax them on money on income that wasn't even earned in the United States and is already taxed elsewhere.
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“Symbolic votes like this that aim to do nothing but pit people against each other will only frustrate the public even more,” Minority Leader Mitch McConnell, R-Ky., said.

This from the man whose party wants to cut NPR and pretend that they're doing something to decrease the deficit.

This from the party who knows that their bills will can't conceivably make it into law without alteration, but insist that even though they only hold 1/2 of the legislative body and anything they do can be vetoed, pretend they have the only hand at the table.

Everything the Republicans do is symbolic and nothing more. They had a chance to symbolically show that they're not bought and paid for by the Big 5. But, of course, they are bought and paid for, so there was nothing for them to show.

Take programs away from retarded adults and poor kids; but line the pockets of CEOs who already make millions.
 
FilmFestGuy;1059495815 said:
Take programs away from retarded adults and poor kids; but line the pockets of CEOs who already make millions.
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That is part of the GOP platform...that along with Millions in aid to protect the fetus but not a dime for the child.
 
Let me correct myself on this post. I skimmed a couple of articles earlier and was mistaken that there were two different bills. One talked about a dual-capacity taxpayer proposal only, leading me to believe it was a separate bill, but was really a part of the tax repeal bill.

However, it would still not double tax oil companies profits made in other countries. What the oil companies were doing is getting foreign governments to treat royalties as corporate income tax - as evidenced by Bahrain's zero corporate income tax, but a 46 percent tax on petroleum-related income. That would allow that country's 'income tax' to be treated as tax credit in the U.S. (dollar for dollar income tax deduction) rather than a standard deduction (percentage of a dollar). The proposal was to allow oil companies the tax credit for the same income tax rate as other corporations pay in that country and not the inflated income tax reported.

But that is all moot, as the bill only had a majority approval and not the super majority vote it needed.
 
MrVicchio said:
I'm not.

Taxes are a cost to business. The higher the tax increase, the more it hurts the profit margin, the more the effect ripples out. Be it higher priced goods, laid off employees, less investment into the business (that would purchase of new equipment, or expansion of existing)...

Taxes are an artificial cost placed on businesses, and like ANY cost, it has consequences.
Click to expand...

Taxes are a proportional deduction from profits, not a production cost.

For industries in a competitive market (where there are multiple suppliers), taxes on businesses in that industry cause a left shift of the supply curve (due to the reduction in no. of suppliers) for the goods produced by those businesses, thereby increasing the price of those goods.

This does not happen in cartels or oligopolies like the oil industry, where prices are set by the firms themselves (instead of by market consensus) at a point that optimizes gross profit based on current production costs and demand for the item it produces (i. e. crude).

The theory behind this is likely too complicated for you. If you went to school and learned economics (instead of say, "learning" it from FOXNews), you would know it.

Suffice it to say, if taxation indeed had zero effect on the oil companies profits because they could merely unload the extra cost onto consumers, then oil companies would not be aggressively lobbying against the increases, which they continually do.

This notion of taxes on oil firms causing high gas prices is just as kooky as conservatives' previously idiotic notion that lifting the offshore drilling ban would cause gas prices to fall.

As (educated) liberals expected, it did not happen.
 
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solletica said:
Taxes are a proportional deduction from profits, not a production cost.
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It's a COST of doing business, and companies find ways to offset that cost.
solletica said:
For industries in a competitive market (where there are multiple suppliers), taxes on businesses in that industry cause a left shift of the supply curve (due to the reduction in no. of suppliers) for the goods produced by those businesses, thereby increasing the price of those goods.

This does not happen in cartels or oligopolies like the oil industry, where prices are set by the firms themselves (instead of by market consensus) at a point that optimizes gross profit based on current production costs and demand for the item it produces (i. e. crude).

The theory behind this is likely too complicated for you. If you went to school and learned economics (instead of say, "learning" it from FOXNews), you would know it.

Suffice it to say, if taxation indeed had zero effect on the oil companies profits because they could merely unload the extra cost onto consumers, then oil companies would not be aggressively lobbying against the increases, which they continually do.

This notion of taxes on oil firms causing high gas prices is just as kooky as conservatives' previously idiotic notion that lifting the offshore drilling ban would cause gas prices to fall.

As (educated) liberals expected, it did not happen.
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You insult, attack and throw out disparaging remarks... oh and you're way off base. Oil Companies don't set prices, the markets do, where did you go to school? You should demand a refund.
 
MrVicchio said:
I'm not.

Taxes are a cost to business. The higher the tax increase, the more it hurts the profit margin, the more the effect ripples out. Be it higher priced goods, laid off employees, less investment into the business (that would purchase of new equipment, or expansion of existing)...

Taxes are an artificial cost placed on businesses, and like ANY cost, it has consequences.
Click to expand...

Does that mean you believe businesses shouldn't pay any taxes?
 
Zyphlin said:
Are we talking about subsidies or tax breaks? I agree, we shouldn't be providing financial assistance to oil companies, I agree with you there. But to me that's significantly different then charging them less in taxes or, as one poster stated and if its true, attempting to tax them on money on income that wasn't even earned in the United States and is already taxed elsewhere.
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OMG :rolleyes:

Any decrease in tax paid by a firm is offset by increases paid by others. In other words, tax breaks are merely money that comes out of your pocket and goes into the firm's.

If you still don't get it, consider this. Suppose you and your neighbor are both single and made $50K last year, and your tax rate was 15%. Then both of you would pay $7500 in taxes this year and be left with $42,500 after-tax income. But then let's say Uncle Sam gave your neighbor a subsidy check for $3000, but nothing to you. Then your neighbor would be left with $45,500 while you would still have the $42,500.

Now what if Uncle Sam instead did not give your neighbor any subsidies, but instead just gave him a 6% tax break, making his tax only 9%, while yours is left at 15%. Now your neighbor would pay only $4500 in taxes, while you'd still pay the $7500, meaning he's be left with $45,500 after-tax income, while you'd be left w/$42,500.

. . .just like what happened when he got the subsidy.
 
MrVicchio said:
It's a COST of doing business, and companies find ways to offset that cost.


You insult, attack and throw out disparaging remarks...
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Sorry, you're supposed to know basic concepts of economics if you're going to talk about it. But many conservatives evidently don't, which is likely why they fall for silly economic propoganda (i. e. "if we allow offshore drilling, gas prices will go down!") that later turn out to be untrue.

MrVicchio said:
oh and you're way off base. Oil Companies don't set prices, the markets do
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Wrong. Monopolies and oligopolies (cartels) control the price and set it based on demand. . .

A monopoly chooses that price that maximizes the difference between total revenue and total cost.

Monopoly - Wikipedia, the free encyclopedia
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Note the difference between a monopoly's price, and the equilibrium price in a competitive market. . .

monopoly_competition.gif


Monopoly - Potential Benefits from Monopoly
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Moderator's Warning:
Cease the personal attacks and focus only on the topic.
 
MrVicchio said:
All tax hikes, and this would be a tax hike, aren't paid by the company. Economics 101. Raise taxes on "eeeeevvvvviiiiilllll" oil companies, and they pass that on to us. Not really a brilliant move to begin with, however... in this moment when gas prices are effecting EVERYONE, who gets hurt more when gas prices go up? Hmmm?
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From the article:

"Some GOP lawmakers argued that the bill would increase gas prices further. However, the nonpartisan Congressional Research Service concluded that eliminating the tax breaks would be unlikely to result in higher gasoline prices, which are influenced by a host of factors. The report said the bill would raise about $1.2 billion in 2012. By comparison, the five oil companies had combined revenues of $1.5 trillion last year."
 
liblady said:
i did not know about this study.....but find a little comfort in this:

In sum, this report finds that providing access to Head Start has benefits for both 3-year-olds and 4-year-olds in the cognitive, health, and parenting domains, and for 3-year-olds in the social-emotional domain.

thanks for pointing this out. perhaps this program needs to be reconsidered, although i can't imagine why it would not benefit kids. makes no sense to me.
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If one removes the biased veil that The Heritage Foundation article put on the report, a much different picture comes through:

"We are improving staff training, raising standards, creating mentoring programs to improve skills of Head Start professionals, building partnerships with schools to sustain Head Start's positive impact, and we are going to fund only high-performing programs.

The result: Head Start simply isn't the program it was when that study was conducted. Denying federal funding would only serve to hurt 60,000 poor children and hamper our efforts to keep improving what is already a vastly improved program.

Since 1965, Head Start has strengthened families and communities by helping more than 27 million poor children prepare for success in school and in life. We intend to build on that legacy by making the program better than ever."
Obama administration has plans for Head Start improvements - USATODAY.com
 
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