Let Energy Provide Our Economic Solution
Tax day has come and gone, leaving most Americans shaking their heads once again at all the time and effort involved in this annual rite of spring
Similarly, businesses of all stripes — not the least of which is the oil and gas industry — have their day of reckoning with the tax collector.
Contrary to the myth spread by detractors, there are no special subsidies for the industry, which supports more than 9 million jobs.
In fact, one overview from Forbes.com pegged the overall effective tax rates of the Big Three oil and gas firms at 41.5% to 48.3%, depending on the company.
These rates were the highest among the 25 top taxpaying companies (in terms of dollar amounts) that Forbes surveyed.
Others, ranging from the American Petroleum Institute to the U.S. Energy Information Administration, have also put the burden near or above 40%.
Furthermore, even though oil and gas firms report large profits measured in dollars, the margin they get to keep as a percentage of total receipts is much lower than many other industries due to the high cost of investment.
As statistics on Yahoo Finance indicate, the most profitable part of the oil and gas sector — drilling and exploration — stood at an 11.4% margin as of April 29.
More than three dozen other categories — such as brewers (15.2%), personal computers (20.7%) and periodical publishing (21.4%) — were ranked as more profitable.
Despite clear evidence that oil and gas companies are already paying their fair share, the industry remains a favorite whipping boy for politicians in Washington.