President Obama’s budget proposal “revived his longstanding attack on oil industry tax breaks and formally launched a plan to pay for alternative vehicle research with drilling dollars,” according to the Houston Chronicle.
“Obama’s budget would save $39 billion over the next 10 years by eliminating ‘fossil fuel tax preferences’ geared toward oil, gas and coal. Items on the chopping block include the oil industry’s ability to claim a domestic manufacturing deduction broadly available to other sectors, and write off ‘intangible drilling costs’ such as site preparation, hauling supplies and fluids used in the process.”
“The administration also proposed establishing new ‘use-it-or-lose-it’ style fees on undeveloped oil and gas leases, while shortening the duration of those contracts. A separate proposal for new user fees on federal oil and gas leases is designed to offset some $40 million in federal inspection of work on those tracts.”