May 2, 2006

Resources on Oil Industry Windfall Profit Taxes

With gas prices on the rise, members of Congress have renewed calls for a “windfall profit” tax on U.S. oil companies. However, previous Tax Foundation research cautions against these taxes, illustrating that they are both economically harmful and a poor revenue source.

“America’s last experiment with windfall profits taxes in the 1980s proved to be economically harmful,” said staff economist Jonathan Williams. “The tax not only failed to raise a fraction of the revenue forecasted, but also stunted domestic oil production.”

For previous research on windfall profits, please see the following:

Tax Foundation Commentary and Op-Eds

Tax Foundation Analysis and Studies

Studies from Other Organizations

For more on gas prices and taxes, please visit our Gasoline Taxes section.