[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 453 Introduced in House (IH)]







110th CONGRESS
  1st Session
                                H. R. 453

To amend the Internal Revenue Code of 1986 to provide that oil and gas 
   companies will not be eligible for the effective rate reductions 
              enacted in 2004 for domestic manufacturers.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 12, 2007

Mr. McDermott introduced the following bill; which was referred to the 
                      Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to provide that oil and gas 
   companies will not be eligible for the effective rate reductions 
              enacted in 2004 for domestic manufacturers.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Ending Subsidies for Big Oil Act of 
2007''.

SEC. 2. FINDINGS.

    The Congress finds that--
            (1) like many other countries, the United States has long 
        provided export-related benefits under its tax law,
            (2) producers and refiners of oil and natural gas were 
        specifically denied the benefits of those export-related tax 
        provisions,
            (3) those export-related tax provisions were successfully 
        challenged by the European Union as being inconsistent with our 
        trade agreements,
            (4) the Congress responded by repealing the export-related 
        benefits and enacting a substitute benefit that was an 
        effective rate reduction for United States manufacturers,
            (5) producers and refiners of oil and natural gas were made 
        eligible for the rate reduction even though they suffered no 
        detriment from repeal of the export-related benefits, and
            (6) the decision to provide the effective rate reduction to 
        producers and refiners of oil and natural gas has operated as a 
        reverse windfall profits tax, lowering the tax rate on the 
        windfall profits they are currently enjoying.

SEC. 3. DENIAL OF DEDUCTION FOR INCOME ATTRIBUTABLE TO DOMESTIC 
              PRODUCTION OF OIL, NATURAL GAS, OR PRIMARY PRODUCTS 
              THEREOF.

    (a) In General.--Subparagraph (B) of section 199(c)(4) of the 
Internal Revenue Code of 1986 (relating to exceptions) is amended by 
striking ``or'' at the end of clause (ii), by striking the period at 
the end of clause (iii) and inserting ``, or'', and by inserting after 
clause (iii) the following new clause:
                            ``(iv) the sale, exchange, or other 
                        disposition of oil, natural gas, or any primary 
                        product thereof.''.
    (b) Primary Product.--Section 199(c)(4)(B) of such Code is amended 
by adding at the end the following flush sentence:
                ``For purposes of clause (iv), the term `primary 
                product' has the same meaning as when used in section 
                927(a)(2)(C), as in effect before its repeal.''.
    (c) Conforming Amendments.--Section 199(c)(4) of such Code is 
amended--
            (1) in subparagraph (A)(i)(III) by striking ``electricity, 
        natural gas,'' and inserting ``electricity'', and
            (2) in subparagraph (B)(ii) by striking ``electricity, 
        natural gas,'' and inserting ``electricity''.
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2007.
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