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S. 1631, The Windfall Profits Rebate Act of 2005, was introduced on September 7, 2005, by lead sponsor Sen. Byron Dorgan (D-ND). If passed, the bill would impose a temporary “windfall profit” tax on crude oil, the revenues of which would be returned to consumers. According to Senator Dorgan’s website, the big oil companies were making $2,430.55 per second in windfall profits on September 26, 2005, and $226.8 million per day. The proposed tax would equal 50 percent of the “windfall profits” from existing oil fields, minus any money spent by the company on qualified investments during the year. The bill would define a windfall profit as the amount by which the selling price of a barrel of crude oil exceeds $40 per barrel, adjusted annually for inflation. Qualified investments would be defined as money spent on refinery property, drilling and development costs, biodiesel facilities, and several other categories. Any newly discovered oil source would not be subject to this tax. The revenues from the tax would be used for consumer rebates, to be sent to taxpayers no later than March 1 of each year. The rebate would not exceed the amount of income and social security taxes paid by the taxpayer in the previous year. Originally published in the October 2005 edition of e-FFICIENCY News |
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