US House votes quadrupling of per-barrel oil tax!…We Lose Again…

Monday, May 31, 2010
By Paul Martin

The US House of Representatives on Friday voted to more than quadruple a per-barrel oil tax that fills a special trust fund to pay for damages from major spills like the Gulf of Mexico disaster.

The measure called for raising the eight-cent-per-barrel tax to 34 cents, raising nearly 12 billion dollars over 10 years for the Oil Spill Liability Trust Fund, which currently holds about 1.5 billion dollars.

The legislation, which passed by a 215-204 margin, also aimed to raise the cap on per-incident trust fund expenditures from one billion dollars to five billion dollars.

Some analysts have warned that the price tag for the catastrophic oil spill that resulted from the explosion aboard the Deepwater Horizon offshore drilling platform run by BP could top 14 billion dollars.

BP is legally responsible for all cleanup costs, but is only liable for up to 75 million dollars in economic damages — a cap that vanishes if the British energy giant is found to have been negligent or engaged in willful misconduct.

To the extent that costs above that are not covered by BP — which has vowed to pay all “legitimate” claims — up to one billion dollars of the additional damages could come about of the trust fund.

The legislation approved Friday would raise that ceiling to five billion dollars.

The Senate was expected to pass a different version of the bill when it returns from next week’s break, meaning that the two chambers would have to agree on a compromise version to send to President Barack Obama.

The House-passed measure’s main goal was to extend a series of provisions aimed at battling stubbornly high US unemployment and extend jobless benefits to late November.

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