- Energy Tax Facts
- 18 Jun 13
Rep. Boustany: IDCs Absolutely Necessary for Independent Producers to Thrive
In today’s age of thirty-second sound bites and fiery rhetoric, the oil and gas industry continues to come under heavy attack. Critics cite “subsidies” and “loopholes” as means by which the industry avoids “paying its fair share.” However, that’s simply not reality. An industry that delivers over $86 million per day to the U.S. Treasury in the form of rents, royalties, bonus and income tax payments, the oil and gas industry serves as a premier catalyst for economic growth both domestically and internationally. At the heart of this growth are independent producers just like you.
However, now you, too, are being squeezed. With intangible drilling costs (IDCs) coming under fire, as a senior Member of the House Ways and Means Committee I am fighting to not only educate my colleagues but ensure these provisions remain untouched. The tax code should not harm the power engines driving this country.
IDCs are legitimate business expenses associated with exploration activities, not tax loopholes, and should be deducted equal to 100% of these costs. For the last 100 years, the IDC deduction has attracted investment capital into the high-risk industry. Its existence is absolutely necessary for independent producers to thrive.
Representing South Louisiana and the Gulf Coast, I am fully aware of the challenges you are facing from this Administration and many politicians. Many of my constituents have voiced their concerns over the crippling effects of bad policies and needless regulations coming out of Washington. I stand in firm support of the tax code allowing the industry to recover costs in order to expand operations. Not only is it good policy, it benefits our nation as a whole.