President Joe Biden is making waves with his proposed change in tax law for fossil fuel companies. The proposal would attempt to make them compensate for flying in the face of green initiatives, according to The Washington Examiner.
The publication reported that Biden plans to kill more than a dozen tax breaks for companies in the oil industry in an attempt to pursue a radical climate agenda.
“It’s a welcome move for environmentalists and Democrats, who have long called for an end to fossil fuel subsidies,” the Examiner’s Abby Smith reported.
“In fact, a clean energy tax proposal advanced by Democrats on the Senate Finance Committee late last month targets many of the same favorable provisions for oil and gas companies as Biden.”
Biden’s move has oil and gas advocates saying that this is too big of a blow to smaller companies in the industry, saying that in combination with the new green regulations by the Biden administration it could be an unwise move:
“It’s, by our calculation, a $143 billion targeted tax increase on our industry, which is the largest offered by any president in their budget proposal by far,” said Aindriu Colgan, tax and trade policy manager at the American Petroleum Institute.
“It’s roughly six times as much as all of the net corporate tax cuts in the [Tax Cuts and Jobs Act] combined,” he added, referring to legislation passed during the Trump administration that slashed the corporate tax rate.
Biden’s proposed end of the fossil fuel tax provisions are part of his plan to increase spending, all in pursuit of slowing down climate change.
These measures are all part of his infrastructure plan, which also covers tax incentives for renewable energy, carbon-free nuclear power, carbon capture and storage, and other clean energy innovations.
According to environmentalists cited by the Examiner, the fossil fuel tax breaks have to be done away with to achieve progressives climate goals.
Matthew Kotchen, a professor of economics at Yale University weighed in saying that the tax provisions were “designed for a time period when it was considered in the national interest to promote more fossil production domestically for national security reasons.”
The results for Biden might not all be good though. The expected four percent decrease in domestic oil production is likely to have a negative effect on the already skyrocketing gas prices, something that is likely to further distance the president from Republicans in the upcoming election.