GOP targeting Democrats’ energy taxes in climate spending bill


Senate Republicans plan to target the billions of dollars in taxes directed at oil and natural gas companies in Democrats’ tax and climate spending bill by forcing votes on a host of amendments in the coming days that would strip such fees.
Democrats plan to pass their bill, the Inflation Reduction Act, along party lines soon thanks to the last Democratic holdout, Sen. Kyrsten Sinema of Arizona, giving it her blessing.
But not before Republicans use what’s known as “vote-a-rama” — an hours-long process that forces the full chamber to consider changes to the budget legislation — to put Democrats on the defensive on a range of hot-button topics with a bevy of amendments, albeit non-binding.  
Sen. Marsha Blackburn, Tennessee Republican, has her sights set on striking two provisions targeting Big Oil.

Through separate amendments, she’ll seek to dispose of a royalty lease rate hike for oil and natural gas drilling on federal lands and in federal waters. Democrats plan to raise the rate from 12.5% to between 16.5% and 18.5%.
Mrs. Blackburn will also seek to prevent the reinstatement of what’s known as the Superfund excise tax on imported crude oil and petroleum products, which is used to fund the clean-up of hazardous waste sites.
Democrats want to reinstate the tax and increase it to 16.4 cents per barrel starting next year through 2032. It could cost oil companies nearly $1.4 million per day, or billions over the next decade, based on the nearly 8.5 million barrels that were imported daily last year. The tax would increase with inflation.
Patrick De Haan, founder of the fuel-price tracking service GasBuddy, predicted the Superfund tax would not “have a significant impact on motorists” on prices at the pump.

Still, Republicans note provisions in the bill could slap Big Oil with a total of $25 billion in taxes over the next decade, potentially leading to higher energy costs.

“With energy prices reaching all-time highs under the left’s failed leadership, we need to bring production back to American soil,” Mrs. Blackburn said. “My amendments will stop the administration’s scheme to punish domestic producers.”
The vote-a-rama process is considered to be primarily symbolic, offering the minority an opportunity to put the majority on the record on a host of issues they would otherwise never be forced to vote on. At the end of the vote series, which could start as early as this weekend, the majority party passes a final amendment negating any previous one that was passed.

Senate Republicans have pledged to make the process as tough as possible in an unlikely, last-ditch bid to twist enough of their Democrat colleagues’ arms to abandon the bill.

“It will be like hell,” Sen. Lindsey Graham, South Carolina Republican, told reporters Friday. “They deserve this.”

“They are empowering legislation that will make the average person’s life more difficult,” he said. “I am hoping we can come up with proposals that will make sense to a few of them and they will abandon this jihad they are on to tax and spend.”

Mr. Graham was joined by several GOP colleagues in ripping into the bill ahead of a series of votes expected over the weekend.

Senate Minority Whip John Thune of South Dakota said the bill will “have no discernible beneficial impact on inflation.”

“This is a big tax increase on job creators in this country that won’t do anything to address the inflation crisis in this country and the economic recession that we’re already in,” Mr. Thune said. “The American people deserve better. We’re going to do everything we can to defeat this bill.”

Mr. Thune has also pledged to make sure the amendments stick by convincing Ms. Sinema and Democratic Sen. Joe Manchin III of West Virginia not to support the overall measure Democrats are expected to put forward at the end of the vote-a-rama.  

Much of the GOP’s focus is on the energy provisions outlined in the bill.
Also in Republicans’ crosshairs is a first-time fee on methane emissions, a powerful pollutant that contributes to climate change. The fee, which would be issued for oil, natural gas wells and pipelines at large facilities leaking methane, would be as much as $1,500 per ton by 2026. The bill includes $700 million in incentives for methane mitigation.

Republicans are also expected to seek changes to how Democrats want to dole out $370 billion toward clean energy, primarily in the form of tax credits. GOP senators have argued that credits for things like expensive electric vehicles should not be included.  

Ms. Sinema, a centrist, said Thursday night she would move forward with the bill so long as changes were made to its tax provisions targeting manufacturers, private equity and hedge fund managers.

Her support gives Democrats the votes they need to begin the process of passing it without any Republicans, which will start Saturday afternoon with a procedural motion to begin debate.  


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