Legislation introduced by Sen. Ron Wyden (D-Ore.) would double excess-profit taxes on oil companies making over $1 billion a year.
The bill, the Taxing Big Oil Profits Act, would impose a 21 percent tax on the excess profits of oil and gas companies making more than $1 billion annually. Excess profits are determined by current profits minus a normal 10 percent return on investment.
“Our broken tax code is working for Big Oil, not American families. While Americans pay more to fill up their gas tanks, Big Oil companies are raking in record profits, rewarding their CEOs and wealthy shareholders with massive stock buybacks, and using special loopholes in the tax code to pay next to nothing in taxes,” Wyden, the chairman of the Senate Finance Committee, said in a statement.
The legislation would also impose a 25 percent excise tax on oil and gas corporation stock repurchased by the company. The bill specifically cites ExxonMobil’s recent announcement that it will buy back $30 billion worth of stock in 2023 and Chevron’s announcement that it will buy back $10 billion in stock by the end of this year.
Senate Majority Leader Charles Schumer (D-N.Y.) co-sponsored the bill, along with Sens. Jack Reed (D-R.I.), Amy Klobuchar (D-Minn.), Debbie Stabenow (D-Mich.), Patty Murray (D-Wash.), Alex Padilla (D-Calif.), Dianne Feinstein (D-Calif.), Bob Casey (D-Pa.), Raphael Warnock (D-Ga.), Chris Van Hollen (D-Md.), Maizie Hirono (D-Hi.) and Richard Blumenthal (D-Conn.).
Congressional Democrats introduced similar legislation earlier this year as gas prices reached record highs in the wake of the Russian invasion of Ukraine.
However, Wyden’s office clarified that unlike those proposals, Wyden’s is tied to profit margins rather than the price of oil. Although gas prices have now been trending downward for several weeks, Democrats were quick to point to both the Russian invasion and the industry’s record profits, often citing the several thousand unused leases currently held by the oil and gas industry on public lands.
The Hill has reached out to Exxon and Chevron for comment.