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WASHINGTON -- A Pennsylvania senator wants big oil companies to be taxed on "excess" profits to help poor people pay for gasoline, according to a report in The Associated Press.
Sen. Robert Casey, D-Pa., said he would introduce legislation to place a 50- percent tax on major oil companies' profits from crude oil priced at more than $50 per barrel, where it has been trading for most of the past two years, the report stated.
The bill, similar to others proposed by members of Congress in recent years, would eliminate oil industry tax breaks and raise the royalties companies pay to the government for offshore drilling leases.
Casey, speaking with seven other new senators at a news conference in Washington, said family budgets have been squeezed by the rising costs of health care, college tuition and fuel. Under his proposed bill, money from the windfall profits tax would be used for a new program to help the poor pay for transportation costs, according to the report. Money from the elimination of tax breaks would fund research into alternative fuels.
The American Petroleum Institute, which represents the oil industry, said in an e-mail that the oil and gas industry's earnings are similar -- as a portion of overall revenue -- to those of other industries. "New taxes would prove counterproductive in light of the tremendous capital investment the oil and natural gas sector needs to meet future U.S. energy demand," the trade group said.
ExxonMobil, one example of big earnings, said it earned $9.3 billion in the first three months of the year. That is up 10 percent from a year ago. Earnings of $1.62 a share came in 10 cents a share above analyst forecasts, the report stated.
Last year, the Texas-based company posted the largest annual profit ever by a U.S. firm.
However, oil company earnings aren't the only thing that's up. As the summer approaches, chances are that gas prices will climb as well, and some energy experts are at odds about just how high the price of a tank of gas will go this summer. The worst-case scenarios have prices topping off at $4 a gallon for regular grade gasoline, according to reports.