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Letter to Hon. Nancy Pelosi, Speaker and the Hon. Steny Hoyer, Majority Leader - Congressional Progressive Caucus Call to Repeal Domestic Fossil Fuel Subsidies in the Build Back Better Act

Letter

By: Ro Khanna
By: Ro Khanna
Date: Sept. 22, 2021
Location: Washington, DC
Issues: Taxes Natural Resources

Dear Speaker Pelosi and Leader Hoyer:

As leaders in the Congressional Progressive Caucus, we urge you to include the repeal of
domestic fossil fuel subsidies in the Build Back Better Act. As you know, President Biden called
for eliminating "billions of dollars in subsidies, loopholes, and special foreign tax credits for the
fossil fuel industry" in his American Jobs Plan.We were dismayed to see that the current
version of the Build Back Better Act in the House is missing most of the domestic fossil fuel
subsidies repeal passed by the Senate Finance Committee earlier this year.

There is no reason that the fossil fuel industry deserves special privileges over other
businesses. The American Petroleum Institute even admitted earlier this year, "If you want to
take the entire tax code and treat the oil and gas industry as every other industry, we're happy to
do that."

Fossil fuel subsidies should be repealed because, instead of creating jobs, they widen the
profit margins of fossil fuel companies, with "over 96% of subsidies going directly to profits
over and above the minimum investment hurdle rates."

In particular, the following subsidies must be repealed:

1. Deduction for Intangible Drilling Costs
2. Percentage Depletion for Oil and Gas Wells
3. Last-In, First-Out (LIFO) Accounting for Fossil Fuel Companies
4. Tar Sands Tax Loophole

Amid an unprecedented and deadly climate emergency, we agree with Speaker Pelosi that, "[i]t's long past time to turn off the spigot of public funds flowing to Big Oil."We implore you to do just that and, in the process, fund the President's agenda to create jobs, expand economic opportunity, and tackle the climate crisis.

Rep. Pramila Jayapal
Chair
Congressional Progressive Caucus

Rep. Ilhan Omar
Whip
Congressional Progressive Caucus

Rep. Ro Khanna
Deputy Whip
Congressional Progressive Caucus

Rep. Earl Blumenaur
Member
Congressional Progressive Caucus

Rep. Barbara Lee
Chair Emeritus
Congressional Progressive Caucus

Rep. Marie Newman
Member
Congressional Progressive Caucus

Cc: James McGovern, Chairman
House of Representatives Committee on Rules


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