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A Project of The Annenberg Public Policy Center

The Return of the Oil Slick

McCain accused Obama of voting for a “Bush and Cheney” energy bill that gave away billions to oil companies. McCain is referring to the Energy Policy Act of 2005, which Obama did in fact vote for. Sen. Clinton raised this same charge against Obama during the Democratic primaries. It was misleading then and it’s equally misleading now.

In fact, according to a Congressional Research Service report, more tax breaks were taken away from oil companies than were given.  Overall, the Act resulted in a small net tax increase on the oil industry:

Congressional Research Service: The Energy Policy Act of 2005 (EPACT05, P.L. 109-58) included several oil and gas tax incentives, providing about $2.6 billion of tax cuts for the oil and gas industry. In addition, EPACT05 provided for $2.9 billion of tax increases on the oil and gas industry, for a net tax increase on the industry of nearly $300 million over 11 years.

The bill did contain $14.3 billion in tax breaks, but most of those went to electric utilities, and nuclear, and also to alternative fuels research and subsidies for energy-efficient cars, homes and buildings – not to the oil industry.