HELENA – Sen. Max Baucus says he is drafting legislation to end billions of dollars in U.S. government subsidies for the five largest oil and gas companies.
The plan outlined Thursday by the Montana Democrat would invest a portion of those savings in increasing production of cleaner and cheaper domestic fuel.
Baucus says the companies’ first-quarter earnings reports show they don’t need the tax breaks. He is proposing eliminating a manufacturing deduction the companies are allowed to make and reducing a tax credit for royalty payments the companies make to foreign governments.
The plan also would create an excise tax on certain Gulf of Mexico leases.
Baucus’ statement comes a day after Senate Majority Leader Harry Reid criticized the oil companies’ high profits amid high gas prices.