The Senate Finance Committee has a hearing scheduled for Thursday, “Oil and Gas Tax Incentives and Rising Energy Price,” to which executives of a select few oil companies have been invited.

“Frankly, we are an attractive target,” said Ken Cohen, ExxonMobil’s vice president of public and government affairs. “I think the term I used was ‘irresistible’ right now for politicians to whale away.”

Cohen and Jaime Spellings, ExxonMobil’s vice president and general tax counsel, spoke this morning on a conference call for bloggers organized by the American Petroleum Institute. Much of the discussion centered on the issues of profits and taxes Cohen detailed in a recent post at ExxonMobil’s Perspectives blog, “ExxonMobil’s U.S. taxes and U.S. earnings – Some relevant numbers for Washington.”

Oil companies are today’s target, but other industries and the public at large should be concerned, Cohen argued.

I just hope that we can have at some point … some rational discussion of what the country’s tax policy should be. And other large industries should also take note, or actually any industry. (continue reading…)

Anticipating proposals from a returning Congress and President Obama to pay for new spending initiatives (or “targeted” tax breaks) by raising taxes on energy production, the National Association of Manufacturers on Sept. 2 sent a letter to House and Senate leadership expressing the NAM’s opposition. The letter, signed by the NAM’s Keith McCoy, vice president for energy and resource policy, objects to the revisions to what’s known in Capitol argot as Sec. 199. Excerpt:

Sec. 199—enacted in 2004—is designed to reduce the tax burden on domestic manufacturers to help spur investment in the United States and create U.S. jobs. The U.S. statutory corporate tax rate currently is 35 percent, almost 10 percentage points higher than the average corporate tax rate for other countries in the Organization for Economic Cooperation and Development. The Sec. 199 provision helps mitigate this tax burden for all domestic manufacturers.

The NAM strongly opposes discriminatory tax policies, especially when they single out a particular type of business or industry sector for non-deductible treatment. Excluding the income from U.S. oil and natural gas production, refining and processing from the Sec. 199 tax benefit will discourage new oil and gas investments in the United States by making domestic energy investments less competitive economically with foreign opportunities. (continue reading…)