After Congress stripped out the most objectionable pieces of last year’s pseudo-energy legislation (H.R. 6), advocates for higher taxes on the oil and gas industry vowed to try again this year. These policymakers never adequately explained how adding another $13 billion in taxes would reduce prices at the pump, ignoring the empirical evidence behind the old saying: Tax something more, and you get less of it.
Really. Here’s more evidence from Alaska:
Alaska’s new oil and gas production tax signed into law by Gov. Sarah Palin Dec. 19 is causing some companies to trim exploration plans on the North Slope.
Brooks Range Petroleum LLC said changes to the production tax will force it to cut its drilling program by about 25 percent, according to Ken Thompson, Brooks Range’s managing director…[snip]
ConocoPhillips Alaska Inc., a major North Slope operator, said it is rethinking its exploration plans for this winter in view of the tax changes.
Do we really want to recreate this phenomenon nationwide?
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