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[Biggs3535]

To be fair, it would more properly termed a severance tax, but the end result is the same. She increased taxes on the oil companies and passed on the cash to the residents of her state thus causing the oil companies in the region to rethink expansion and new drilling. Pretty much what folks say about the problems with the windfall tax.

From the article you linked:

The Alaska tax is imposed on the net profit earned on each barrel of oil pumped from state-owned land

There is a difference between those oil companies in Alaska paying a percentage of their profits from the oil that drill on state-owned land, and the windfall profits tax that Senator Obama is proposing.

It's kind of like a lease agreement where you agree to pay the owner of the building a percentage of your profits in lieu of a monthly rent payment, as opposed to you being the owner of your building and having some outside force coming in and saying you owe a certain percentage of your profits or you go to jail.

[NovaBuc]

To be fair, it would more properly termed a severance tax, but the end result is the same. She increased taxes on the oil companies and passed on the cash to the residents of her state thus causing the oil companies in the region to rethink expansion and new drilling. Pretty much what folks say about the problems with the windfall tax.

From the article you linked:

The Alaska tax is imposed on the net profit earned on each barrel of oil pumped from state-owned land

There is a difference between those oil companies in Alaska paying a percentage of their profits from the oil that drill on state-owned land, and the windfall profits tax that Senator Obama is proposing.

It's kind of like a lease agreement where you agree to pay the owner of the building a percentage of your profits in lieu of a monthly rent payment, as opposed to you being the owner of your building and having some outside force coming in and saying you owe a certain percentage of your profits or you go to jail.

 Right, that is what a severance tax is and why I stated it should be called that. Regardless, the end result is the same. Well, almost the same. The windfall profits tax is only if profits reach a certain level, the severance tax is imposed regardless of the level of profit, just as long as there is a profit on the barrel of oil.

 As you quoted from the article:

The Alaska tax is imposed on the net profit earned on each barrel of oil pumped from state-owned land

.

 Also, to be fair, the tax Obama and others are talking about imposing is more properly termed an excise tax - at least as long as they continue to use the same framework as the Crude Oil Windfall Profit Tax Act of 1980, which according to the Congressional Research Service is a bit of a misnomer for the title as the taxes were imposed not on profits but upon the difference between the market price of oil, which was technically referred to as the removal price, and a statutory 1979 base price that was adjusted quarterly for inflation and state severance taxes.

 In the end, it is more or less semantics. Essentially both are the same to you, me and the oil companies. The oil companies have higher taxes imposed upon their profits and the government is using those funds to give money to the citizens.

[Biggs3535]

In the end, it is more or less semantics. Essentially both are the same to you, me and the oil companies. The oil companies have higher taxes imposed upon their profits and the government is using those funds to give money to the citizens.

The principle behind the two situations are totally different, Nova.

One is the gov't collecting money from the property it owns and the other is the gov't saying you make too much money and I have the power to take as much as I deem necessary.  What's going on in Alaska isn't a tax, as we think of it now; the oil companies and the gov't are essentially in a partnership and the gov't collects a percentage.  That, and the Windfall Profits proposal are two different animals.

The end result is the same when someone jumps off of a building and when they are pushed, but the situation surrounding that end result is completely different.

[NovaBuc]

 Sorry, should have put this in my post before this Biggs, bit distracted at a party for my niece who is heading off to college for the first time next week.

 You seem to think this severance tax is the lease payment the oil companies are paying for the rights to drill the oil. It's not, it's a tax on the profits of the oil that is drilled. Completely separate and independent of the royalties, leases and licensing fees they already pay the state for drilling the oil. They aren't entering into a lease agreement or a partnership of any kind with a severance tax. It is a tax imposed upon the company based upon their profits, they have no choice but to pay it just as there is no choice but to pay the income tax. They can't negotiate it, though they can lobby to try to get it changed. Governor Palin decided to increase that tax when she got into office for two reasons: She felt the existing tax rate was too favorable to oil companies and she wanted her state to cash in on the increased price of gas and pass on some of what was collected to the citizens of her state in addition to the money each Alaskan already gets from the fund set aside from oil leases.  There's no way to get around the fact it is a tax on income, something we should all be able to understand.

 I guess I should probably define what a severance tax is, perhaps that will help with understanding it. A severance tax is a tax imposed by a state government upon corporations that are harvesting the state's natural resources, it's not a lease fee or a royalty. It's a tax.

[Biggs3535]

I guess I should probably define what a severance tax is, perhaps that will help with understanding it. A severance tax is a tax imposed by a state government upon corporations that are harvesting the state's natural resources, it's not a lease fee or a royalty. It's a tax.

Do the oil companies have to pay those severance taxes to the state if the oil comes from private land or Federal land?

[cskapper]

I know that I don't know as much as many of you do - but I always thought that a basic precept of socialism was "each according to his need".  In that, the State would give money to those whom needed it the most.  Now since the State doesn't have any means of making money except to tax corporations and citizens - the only means to redistribute the wealth was to tax.  Therefore, to give to the needy poor who are not working for their income because it is being giving to them - the State takes it from my wallet in the forms of taxes. 

Partially true synopsis: Basically, the "poor" people in the US get to reach into my wallet via the State and take money out to pay for their DirecTV NFL Ticket that is coming from the satellite dish connected to their trailer.  Meanwhile, living fat on the hog in my 28% tax bracket - I am checking to see if it's worth spending 20 cents per pound extra to get lower fat ground beef at Publix when I grill on Sunday only to find out the game's blacked out due to poor ticket sales...

[Lamond]

You think 28% is the highest tax bracket? That's funny.

I don't know what you do for a living, but I'd guess you're less than six months away from that trailer if you lose your job.

This economy is that bad right now.

[DBrooksIsMyDaddy]

You think 28% is the highest tax bracket? That's funny.

I don't know what you do for a living, but I'd guess you're less than six months away from that trailer if you lose your job.

This economy is that bad right now.

He didn't say that 28 percent was the highest bracket, he said that is HIS bracket.

[Lamond]

Which would make him middle class at best. In case you haven't noticed there's a war on the middle class and Chris is on the front line.
Hope he doesn't become a casualty.

[DBrooksIsMyDaddy]

Which would make him middle class at best. In case you haven't noticed there's a war on the middle class and Chris is on the front line.
Hope he doesn't become a casualty.

Most Americans are six months away from the trailer if they lose their jobs.  This isn't a new phenomenom, as Americans' personal debt has been increasing for decades.

[Lamond]

Yep. That's why we need "Change". Thank you for making my point.

[DBrooksIsMyDaddy]

Yep. That's why we need "Change". Thank you for making my point.

Pick a date in the past thirty years and Americans would be in the trailer if out of work for six months.  We had some good years in the eighties and nineties economically, and people still ran up their credit cards and spent beyond their means.  That's the real point here.

[Lamond]

Well I can pick 8. 1992-2000. But you're right.

Hmmm...what do the other 30 years have in common?

[DBrooksIsMyDaddy]

Well I can pick 8. 1992-2000. But you're right.

Hmmm...what do the other 30 years have in common?

Yes, the stock market dot com bubble was *all* due to the democrats.  I really can't even discuss politics with you anymore, you remind me too much of my brother, who is one of my closest friends but with whom I refuse to discuss politics.  He's a right-winger, by the way, and argues just like you do, but on the other side.  I've been a registered democrat for my whole voting life, and liberal, but the direction in which the party has been headed makes my head spin.  Democrats used to be the most patriotic of Americans, now all the bashing of the country makes me nauseous.  It just smacks of political tactics to frighten Americans into voting for them, like your comment about you hope Mike doesn't end up in a trailer.  So you may have your political discussions back, Lamond.  Have a nice day.

[Lamond]

Yeah I know opinions you can't change get very annoying. You have a good one too.