Jersey Journal

Across From Hoboken BP, Menendez Presents Act To Fight Big Oil's Tax Loopholes

The Jersey Journal — Monday, June 7, 2010

By Anna Yukhananov / The Jersey Journal

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Standing across the street from the Hoboken BP gas station at Park Avenue and 14th Street this morning, U.S. Sen. Robert Menendez highlighted legislation that would close tax loopholes for the largest U.S. oil companies.

"The flow of money to the oil companies is like the gusher in the Gulf of Mexico," Menendez said flanked by good government leaders and Hoboken Mayor Dawn Zimmer. "But we can top fill these loopholes and shut them down quickly and permanently."

Menendez estimated that the tax changes could save taxpayers $20 billion over 10 years, with at least $750 million of that money going to New Jersey.

"This is just the kind of help we need from Washington," said Adam Sherman, the central New Jersey organizer for New Jersey Citizen Action, a citizen watchdog coalition.

Currently, oil companies can avoid paying royalties for certain oil and gas production in the Gulf of Mexico, and receive tax deductions for some production costs. The companies can also manipulate rules on foreign taxes in order to avoid paying full corporate taxes in the United States, Menendez said.

With oil companies taking up four of the top 10 spots on the Fortune 100's list of the largest corporations, "big oil doesn't need $20 billion of U.S. taxpayer money to be profitable," Menendez said.

The Close Big Oil Tax Loopholes Act, co-sponsored by Sens. Bill Nelson, D-Florida, and Jeff Merkley, D-Oregon, would get rid of the tax breaks for large oil companies, while allowing some tax deductions and credits for oil companies with revenues of less than $100 million per year.

"I don't want to bequeath to future generations of New Jerseyans tar-slicked beaches," Menendez said, alluding to the environmental disaster in the Gulf of Mexico.

Menendez said he chose Hoboken as the best place to promote the Tax Loopholes Act because of the city's focus on environmentally-friendly technologies and green initiatives.

"Hoboken is a community moving to a greener, most sustainable model," he said. And presenting the Loopholes Act in front of BP station is "the perfect opportunity to dramatize all this," he added.

Zimmer, who joined Menendez at the press conference, said the city has completed an energy audit, and plans to implement several green programs, including sensor lighting in all city buildings, a car-sharing program, and cross-town bus service.

Zimmer rode a bike to the press conference.

Menendez said that the money the government would get from closing the tax loopholes could help balance the state budget, reduce taxes, or support investment in new energy sources.

"We need to embrace the future rather than paying the oil companies to continue the policies of the past," he said.

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