Thursday, December 08, 2005
  Novak's taxing hypocrisy

Novak and Taxes Thursday, December 08, 2005

by: Francis Meehan

Novak is crying for the oil companies. He thinks that the GOP controlled congress is screwing them. (emphasis mine)

The "manager's amendment" routinely approved by the Senate just before passage of its tax bill Nov. 17 included an unnoticed change in U.S. tax law applied to Big Oil. It would prevent three U.S.-based companies that produce oil abroad from continuing to reduce their U.S. taxes by the amount they pay foreign governments in taxes.

He implies that the GOP is under pressure to do something about excess oil profits.

When gasoline prices soared well over $3 a gallon earlier this year, executives of five integrated (exploring, refining, retailing) companies were summoned by the Senate Commerce Committee to explain why they were making so much money. Republican politicians were in a quandary. They wanted to appease their constituents,....

Bless his little heart. He wants to protect the rights of the oil companies to continue to deduct foreign taxes against their US taxes. Does Novak like the foreign countries better than the US?

However, that is still a sideshow. The real indication of Novak's sympathies, which lie with business, is that he supports the idea of taking away an individuals right to deduct their state taxes against their US taxes.

Back in the heydays of the 90's Novak supported an entire overhaul of the federal tax system. From Jan. 10th, 2000:

Tax cuts are only the first step if the Republicans are to have a

real impact on how the public's business is done. After all, today's tax cut can be reversed by tomorrow's tax increase. What is needed, and what has been sorely lacking from Republican leaders, is a realistic plan for overhauling the entire federal tax structure.

The only viable alternatives to the current tax code are a flat tax and

a national sales tax.

House Speaker Newt Gingrich enthusiastically embraced the flat tax, with two little caveats: that two big tax exemptions, for home mortgage payments and for

charitable contributions, must remain.

Novak is derisive of Gingrich because he wanted to retain 2 exemptions...and neither one was for state taxes.

I haven't looked at the profit/loss statements of the oil companies. I have heard of large profits...with the caveat that it's only 9-10% of gross receipts...less than Coke's 20%. I know that oil prices went up before the Katrina fiasco because of the war in Iraq. I bought XOM years ago for my son's college fund. I want them to do well. I know that the value of the company was going up well before Katrina. For the past 6 months the stock went up and down, with a serious spike up just after Katrina...followed by a significant drop.

My anger isn't for or against the tax. It's against the hypocrisy of Novak.

So, if you’re an individual, hold onto your wallets. Novak will support an oil company's deduction...but not yours.

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