Huffington Post and Salon.com are citing a study on the Illinois Gas Tax Holiday Obama supported as a state legislator apparently showing that consumers did benefit.
http://www.salon.com/...
But reading past the headline, there is still cause for skepticism.
The study is titled "$2.00 Gas! Studying the Effects of a Gas Tax Moratorium," by Joseph J. Doyle Jr. and Krislert Samphantharak. Download the PDF here. The authors concluded that "the suspension of the 5% sales tax led to decreases in retail prices of 3% compared to neighboring states. And when the tax was reinstated, retail prices rose by roughly 4%."
This suggests that the tax holiday delivered at least 60 percent of the tax savings to motorists.
So 60% of the 18.4% gas tax would actually go to the consumers. So consumers will get an 11% break. And that $30 they are supposed to save over the course of the summer will actually be less than $20.
And what about the charge that this will cost money for infrastructure and construction jobs?
But under Clinton's plan, if properly implemented, any additional profit realized by an oil company by passing on the cost of the windfall profits tax to customers would also be subject to the tax. This means a dollar passed through to consumers to offset the tax would appear as profit ... and be taxed.
How to enforce this? Make it against the law for oil companies to pass the price of the windfall profits tax on to consumers, and then audit the oil companies' books. It is not a difficult accounting exercise to tax excess profits above a certain gross percentage per barrel of oil, or gallon of gas. Every major oil company has sophisticated profit segmentation reports that go to the very senior management of the company. These reports identify revenues, costs and profit at each level of the vertically integrated operation, broken down on a per barrel basis by product type, marketing region, you name it.
Many have already challenged the notion that a windfall profit tax could ever get through Congress. Could you imagine a third bill to make it a criminal action to pass this tax on to consumers?
Even if we could push through all three measures, where is the money for the administrative cost of enforcing these investigations into the corporate books going to come from?
But all of this is worth it of course because
A savings of $30 or $50 is a significant amount of cash for at least some Americans.
Wouldn't those Americans benefit even more from Obama's blanket $1000 tax credit?