May 28, 2022

OPINION: An excess profit tax on price-gouging energy companies should be enacted now

OPINION: An excess profit tax on price-gouging energy companies should be enacted now

Sponsored Links

A senior House Democrat inside Speaker Pelosi’s leadership team just called for Congress to explore a windfall profit tax to curb price gouging driving consumer price inflation. (Exclusive video embedded below)

OW-Advertisement

A lot has been written—including by us—on how oil companies making record profits are exploiting the inflation narrative and the conflict in Ukraine to charge consumers more at the pump. Members of Congress are beginning to take notice.

In an interview with Occupy Democrats, a member of House Democratic leadership, Rep. Jan Schakowsky (D-IL) said it is time to study an excess profits tax on oil companies profiteering and price gouging consumers with high prices.

“We should do what we did during World War II when there were surplus profit taxes”, said Rep. Schakowsky. “There was polling that was done, 80 percent of Americans, so you better believe it’s not just Democrats. Democrats, Republicans, and independents think that it may be time for surplus profits taxes right now.”

Twenty-five of the world’s biggest fossil fuel corporations pulled in about $205 billion in profits last year, according to a report by government watchdog group Accountable.US.

Shareholders from fourteen firms were rewarded with more than $35 billion in stock buybacks and dividend bumps.

Exxon made record profits even before Vladimir Putin’s invasion of Ukraine scrambled energy markets.

Sponsored Links

Earlier this year, the fossil fuel giant announced profits of almost $9 billion for the fourth quarter of 2021—its biggest take in seven years. Other petroleum giants like Chevron, Shell, and BP announced surpluses of only slightly less startling proportions.

Sponsored Links

It’s time for Congress to step in and stop this unfettered corporate greed.

Senator Bernie Sanders (I-VT) has also floated the idea that Rep. Jachowsky discussed with Occupy Democrats. “It is time to enact a windfall profits tax and reasonable price controls,” tweeted the Senator from Vermont.

Democrats on the Senate Finance Committee are discussing ways to tax these greedy oil and gas companies. Finance Chair Ron Wyden (D-OR) told reporters that they were “looking at it right now” and that the panel is reviewing concepts and proposals.

Finance committee member Sheldon Whitehouse (D-RI) has actually introduced a windfall profits tax bill that would levy a quarterly tax on the largest oil companies and distribute the revenue to consumers through a quarterly rebate.

The per-barrel tax would be equivalent to half the differential between the pre-pandemic average oil price from 2015 through 2019 and current prices.

An alternative proposal has been introduced by House Transportation and Infrastructure Chair Peter A. Defazio (D-MA). It levies a 50 percent tax on large oil producers’ taxable income for 2022 that exceeds 110 percent of their average adjusted taxable income from 2015 through 2019. It would also distribute the revenue to consumers through a monthly refundable tax credit.

Congress needs to take swift action to alleviate the pain consumers face at the pump and combat the disinformation being spread by oil companies to excuse their price gouging.

Sponsored Links

As Rep. Jachowsky said in our interview with her, the surprise profit tax proposal would help address the temptation by these companies to take advantage of consumers while blaming “the supply chain, the pandemic, and everything else you can think of.”

Here’s the video:

Thomas Kennedy is an elected Democratic National Committee member representing Florida. He tweets from @tomaskenn.

RELATED STORY: NEW HOPE: Finding of massive lender misbehavior could lead to student loan debt relief for millions

Thomas Kennedy

is a reported opinion columnist and roving correspondent. He's an elected member of the Democratic National Committee from Florida and a Director of Sunshine Agenda Inc. a government transparency nonprofit organization.

Sponsored Links