U.S. Senate finance chair to propose tax on excess oil profits By Reuters

By David Shepardson

WASHINGTON (Reuters) -U.S. Senate Finance Committee chair Ron Wyden is planning to introduce legislation setting a 21% surtax on oil company profits considered excessive, an aide for the senator told Reuters.

The bill applies a 21% additional tax on the excess profits of oil and gas companies with more than $1 billion in annual revenue, the aide said. The 21% tax would be in addition to any regular income tax due. Profits over 10% would be considered excessive under the bill, according to the aide.

Unlike other proposed windfall profit taxes, the aide said, Wyden’s would apply the tax based on profit margins, not oil prices. Companies making normal profits based on their expenses would not pay any additional tax.

“While Americans pay more to fill up their gas tanks, Big Oil companies are raking in record profits, rewarding their CEOs and wealthy shareholders with massive stock buybacks, and using special loopholes in the tax code to pay next to nothing in taxes,” Wyden, a Democrat, said in a statement.

President Joe Biden on Friday accused the U.S. oil industry, and Exxon Mobil Corp (NYSE:) in particular, of capitalizing on a supply shortage to fatten profits after a report showed inflation surging to a new 40-year record.

Bloomberg first reported the planned legislation.