Here’s the deal. The Republicans are proposing to apply an extra tax to the oil companies, which either, a) since corporations don’t pay taxes, I will end up paying or, b) will reduce the oil companies’ ability to find new oil, thereby making the gas I buy more expensive.
To make up for increasing the price and/or reducing the availability of gasoline, the Feds are going to send me $100 out of what they looted from the oil companies.
After that, I will have to report it on my income tax return.
Pretty clever, don’t you think? The Feds take $100 of after-tax oil company money and give it to me to be taxed again, simultaneously creating new federal jobs to administer the tax “rebate” program.
I am aware, though, that the Feds already tax me 18.4 cents on every gallon, and my state adds a 6 percent sales tax. This brings my federally mandated gasoline tax to 19.5 cents a gallon.
If the average Michigander buys 15 gallons of gas a week, at 19.5 cents tax per gallon (ignoring the 19.9 cent Michigan tax for this example), that average Michigander would save $152.13 per annum – regardless of the actual price of gasoline – if the federal tax were eliminated. And he or she would not have to pay income tax on his or her “windfall.”
Elimination of the existing federal tax would also enable the elimination of the federal jobs administering that tax. Better, our average Michigander wouldn’t have to pay additional income tax on money looted from others (including, by the way, shareholders and pension funds), which will reduce his or her annual share of the booty to the $70-something range.
To compensate for the convoluted way in which this GOP proposal would work, I am advocating a rider to the bill which would add oil companies to the list of approved charities.
That way, when I get the $100, I can send it to Exxon and at least get a charitable deduction.