Number: RL33763
Title: Oil and Gas Tax Subsidies: Current Status and Analysis
Authors: Salvatore Lazzari, Resources, Science, and Industry Division 
Abstract: The Energy Policy Act of 2005 (P.L. 109-58), enacted on August 8, 2005, expanded some of the existing tax subsidies for the oil and gas industry and created several new ones. The oil and gas tax incentives in EPACT05 were added on top of several existing special tax subsidies for oil and gas. The industry also benefits from provisions of current tax law that are not strictly tax subsidies (or tax expenditures) but that nevertheless provide advantages for and reduce effective tax rates of the oil and gas industry. The remainder of this report discusses these tax provisions in detail. The first section, below, discusses the origin and evolution of the oil and gas tax subsidies that were incorporated into the 2005 act. The second section summarizes each of the oil and gas tax subsidy provisions in the 2005 energy act and reports its corresponding revenue loss estimate. Section three describes other oil and gas tax subsidies, those that existed before EPACT05 and were generally not affected by it. The final section describes several tax provisions that benefit the oil and gas industry; these are not tax subsidies per se - they are not considered to be tax expenditures - but are deemed by some observers to confer excessive (or unfair) benefits for the industry.
Pages: 21
Date: February 27, 2007