Skip to main content

Exxon Mobil
First-quarter earnings at the world's biggest company hit $9.5 billion, according to a release by ExxonMobil.

That gargantuan bottom line was no doubt padded just a smidge by the fact that Exxon gets $600 million in annual federal tax breaks. Every effort to eliminate these breaks—recently pushed by Sens. Bernie Sanders of Vermont and Robert Menendez of New Jersey—can't get through Congress. Surprise, surprise. Exxon pays an effective corporate income tax rate of about 13 percent, just over a third of the nominal rate of 35 percent.

One tax break is particularly egregious. Exxon (and other oil companies) don't have to pay eight cents a barrel into the federal Oil Spill Liability Trust Fund for tar sands oil. That's because tar sands oil gets an exemption from the tax because it's not "conventional oil."

Very convenient when your company spills a half-a-million gallons of ... uh ... unconventional oil somewhere as Exxon's Pegasus pipeline did on Easter Sunday in the little town of Mayflower, Arkansas. An incredible mess. For PR purposes, Exxon called this "oil." For tax purposes, however, it's "dilbit," diluted bitumen shipped from the tar sands of Alberta. The tar sands deposits are definitely unconventional "oil" that is dirtier, harder to extract, harder to refine, harder and more expensive to clean up, and viewed by many of its fans as North America's pathway to the elusive objective of energy independence.

Exxon says it is paying to clean up the Mayflower spill, a process that is ongoing, and that it will cover every "valid claim" presented by affected residents. But the company is under no obligation to do so. That tax loophole is one that ought to be remedied sooner rather than later as dilbit, with or without the building of Keystone XL pipeline, is going to flow in ever-greater quantities into the United States over the next decade or more unless legislation forbids it. And despite the propaganda, where there's oil flow, there are oil spills.

Rebecca Leber takes note of where Exxon puts  some of its lightly taxed take-home dollars:

• $12.97 million spent on lobbying in 2012 "to protect low tax rates and block pollution controls and safeguards for public health." Through March 31 this year, Exxon has spent $4.84 million lobbying.

• $3.6 million invested in contributions to PACs, candidates, and outside groups for the 2012 election cycle. Eighty-nine percent of that dough went to Republicans.

• $5.6 billion spent on buying back its own stock, something that makes the largest shareholders and best-paid company executives even richer.

• This year, Exxon CEO Rex Tillerson, who has said climate change isn't so bad and only requires an engineering solution, received a 15 percent raise in his salary to $40.3 million, 769 times the median U.S. household income.

Originally posted to Meteor Blades on Fri Apr 26, 2013 at 09:56 AM PDT.

Also republished by Daily Kos.

Your Email has been sent.
You must add at least one tag to this diary before publishing it.

Add keywords that describe this diary. Separate multiple keywords with commas.
Tagging tips - Search For Tags - Browse For Tags


More Tagging tips:

A tag is a way to search for this diary. If someone is searching for "Barack Obama," is this a diary they'd be trying to find?

Use a person's full name, without any title. Senator Obama may become President Obama, and Michelle Obama might run for office.

If your diary covers an election or elected official, use election tags, which are generally the state abbreviation followed by the office. CA-01 is the first district House seat. CA-Sen covers both senate races. NY-GOV covers the New York governor's race.

Tags do not compound: that is, "education reform" is a completely different tag from "education". A tag like "reform" alone is probably not meaningful.

Consider if one or more of these tags fits your diary: Civil Rights, Community, Congress, Culture, Economy, Education, Elections, Energy, Environment, Health Care, International, Labor, Law, Media, Meta, National Security, Science, Transportation, or White House. If your diary is specific to a state, consider adding the state (California, Texas, etc). Keep in mind, though, that there are many wonderful and important diaries that don't fit in any of these tags. Don't worry if yours doesn't.

You can add a private note to this diary when hotlisting it:
Are you sure you want to remove this diary from your hotlist?
Are you sure you want to remove your recommendation? You can only recommend a diary once, so you will not be able to re-recommend it afterwards.
Rescue this diary, and add a note:
Are you sure you want to remove this diary from Rescue?
Choose where to republish this diary. The diary will be added to the queue for that group. Publish it from the queue to make it appear.

You must be a member of a group to use this feature.

Add a quick update to your diary without changing the diary itself:
Are you sure you want to remove this diary?
(The diary will be removed from the site and returned to your drafts for further editing.)
(The diary will be removed.)
Are you sure you want to save these changes to the published diary?

Comment Preferences

Subscribe or Donate to support Daily Kos.

Click here for the mobile view of the site