Oil and gas exploration and development (E&D) subsidy has been in existence since the early days of the income tax and is available to integrated and independent oil and gas companies. The Obama administration estimated that it could raise nearly $14 billion by repealing tax credit (Zengerle). In a protest, the American Petroleum Institute would launch new print and radio ads to “educate the consumers” (Snow). All these developments have spurred a nation-wide verbal war. But reality demands some incentives for the green energy industry in terms of reduced competition. The arguments in favor of “Green Energy” are clearly apprehensible on the medium to long term basis. The world’s primary demand for energy is expected to increase by one third by the year 2035. As the time goes on, the price mechanism of the energy market will be more focused on the development in the emerging economies. This will put the developed economies in an uncomfortable position as demand cut back on their behalf won’t have much effect on the prices of the energy. Today the US consumes nearly half of the total oil produced, but by 2035, nearly 30% of the consumption will shift to Asia backed by heavy use of automobiles. Also there is a “Peak oil” situation already in process. By 2020, the oil production from the Middle East and North Africa is expected to decline by 6 million barrel per day. Hence, for a long term policy formulation, preference should be given to the green energy sector. Another long-term concern is global warming. By 2035, the CO2 emission is expected to increase by 20%. ...
Moreover, these are environment friendly and good for human health. The combined basket for green energy also contains green technology. The development and operation of green energy power systems are still in their growing phase. The focus of innovation is still centered on energy efficiency. A lot of industry practices have been standardized. So replacing the old inefficient power systems is no more a problem (Pembina Institute). The oil & gas industry has its own arguments as well. One of the most talked about argument is that rising taxes will not make the gasoline cheap; rather, it may push the price higher. Another argument is that, with the repeal, investment for deep water gas and oil production will be discouraged and this will result in more severe shortage of fuel in the long term. The oil & gas industry observers argue that there will be a possible loss of 50,000 jobs in the near future (Snow). The other major argument is that the exploration of oil & gas is a very capital incentive and risky business. So, the repeal of tax credits will definitely hurt the small producers (Zengerle). There is no doubt that the repeal of tax credits will push the spot price higher, at least for the short term and it will hurt the common American people. Again, without the tax incentives, the exploration sector will not find much investment; hence, companies with heavy reliance on exploration business will definitely get hurt. It takes years of investments to make one single well productive. So, reduction in work force is a possible reality. Also there is no doubt that future-supply will decline substantially as present day exploration activities will decline; and oil still satisfies a major share of total energy needs and will remain in the dominating ...
Cite this document
(“Why Congress (USA) Should End Big Oil Tax Credits and Give That Money Essay”, n.d.)
Retrieved from https://studentshare.net/english/61779-argument-paper-why-congress-usa-should-end-big-oil
(Why Congress (USA) Should End Big Oil Tax Credits and Give That Money Essay)
“Why Congress (USA) Should End Big Oil Tax Credits and Give That Money Essay”, n.d. https://studentshare.net/english/61779-argument-paper-why-congress-usa-should-end-big-oil.
In addition to that, the plan is intended to generate increased revenue and also limit the dependence of US on the imported oil. In order to achieve this, a comprehensive oil exploration plan has recently been jointly released by President Barack Obama and the Interior Secretary Ken Salazar.
It can be said that the real intensive search for oil began thereafter. Corsicana came to be known as next major oil field in the state of Texas. By 1901, it became one of the largest oil producing fields in the country outside Pennsylvania. During 1922-23, the state of California came to be known as the top oil producing state in the US.
Two types of subsidies were granted: one where the intangible expenses of drilling related activities were deducted from the oil companies’ expenditures for tax purposes and the other whereby cost deduction was based on gross proceeds and not the actual price of oil (Franks and Nunnally).
The recent reform in the US tax code in the Congress is with the aim to reduce the number of people who evade tax, while promoting the economy’s growth (Snowdon 35). The tax code is aiming at a situation where the tax levied on the people is fairer and everyone pays according to their levels of income.
It is suspected that the oil industry is taking advantage of its monopoly based on huge market control and lax energy trading oversight to gouge the public, squandering the opportunity to invest in cleaner, sustainable sources and curb the nation's dangerous addiction to oil.
This paper explains the Tax Year End Process that will need to be put in place in relation to the company payroll. The paper will address the necessary procedures, deadlines and person responsible for a variety of tasks to ensure that the company meets compliance with U.K.
The more subsidies are put into green energy, the more adverse effects are generated into the economy. Subsidies constitute costs to whatever source the subsidies are drawn from. Specifically, the subsidies are financed by government revenues which are
But because of the harmful environmental effects of the nuclear wastes, environmentalists oppose the inclusion of nuclear energy under green energy. The aim of coining the term green energy was to separate the less polluting fossil fuel from the more polluting
They have either ‘sold their ideas to energy producing firms or issued it to the public to help them come up with green energy. Fossil fuels when burnt to produce energy emit carbon dioxide, which is a threat the ozone layer that protects humans from harmful radiations
4 Pages(1000 words)Essay
GOT A TRICKY QUESTION? RECEIVE AN ANSWER FROM STUDENTS LIKE YOU!
Let us find you another Essay on topic Why Congress (USA) Should End Big Oil Tax Credits and Give That Money to Green Energy Companies for FREE!