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WASHINGTON, D.C. -- NACS, the Association for Convenience & Fuel Retailing, along with several other oil and gas groups, have sent a joint letter to congressional leaders asking for a pro-growth solution to the upcoming "fiscal cliff" crisis. Specifically, NACS and other groups are asking for a solution that focuses on job creation, while avoiding targeted tax increases on particular industries.
"Throughout the economic downturn, America's oil and natural gas industry has provided one of the few bright spots as the economy struggles toward recovery," read the letter, which was sent to Senate Majority Leader Harry Reid (D-Nev.), Senate Minority Leader Mitch McConnell (R-Ky.), House Speaker John Boehner (R-Ohio) and House Minority Leader Nancy Pelosi (D-Calif.) "Through hundreds of billions of dollars invested to develop vast new oil and natural gas reserves, and to expand our refining capacity, this industry is not only producing the energy a growing economy needs, but also creating tens of thousands of high paying jobs while generating billions in new revenue for the government. Therefore, any attempts to target the oil and natural gas industry for punitive tax treatment should be avoided as higher taxes could put the economic growth we've created at risk."
According to several media reports, one potential solution to the upcoming fiscal cliff crisis is to increase the federal gas tax, currently at 18.4 cents per gallon.
The fiscal cliff refers to a $500 billion combination of tax increases and spending cuts set to commence on Jan. 2 if no government agreement can be made. Dec. 31 marks the end of the tax cuts signed into law by former Pres. George W. Bush.
Although many argue the tax increases and spending cuts would go a long way toward balancing the federal budget, individuals could see more taxes taken out of their paychecks if the fiscal cliff is not avoided. In addition, taxes on interest and dividends could increase substantially, which mean consumers would have less money to spend, and therefore cripple the retail industry.
"We fully recognize that a solution to the debt and deficit crisis facing the nation must be found," the letter written by NACS and other oil and gas groups stated. "However, tax and revenue issues are best addressed as part of a comprehensive tax reform effort. We look forward to being part of the constructive efforts post-'lame duck' when all issues, and all taxpayers, are considered equally -- while providing an opportunity to remain focused on economic growth and competitiveness."
Warren Buffett, CEO of Berkshire Hathaway and one of the richest people in the world, predicted on CNBC today that Washington lawmakers will be able to come up with a solution for the looming fiscal cliff crisis, but added he is not sure it could be accomplished by the end of this year.
Buffett added he did not favor any one solution and it would not be "the end of the world," if a solution is reached shortly after Dec. 31, the current deadline.