May 2, 2006

Resources on Oil Industry Windfall Profit Taxes

Download The Windfall Profit Tax on Crude Oil: Overview of the Issues

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
Crude Economics: Windfall Profits Taxes Hurt Consumers at the Pump
The Windfall Profit-Taxers Are Back
Who Profits at the Pump?
Audio Commentary: Are Windfall Profits Taxes Good Economics?
The Consequences of a Windfall Profits Tax
Windfall Taxes Hit Retirees Hard
Windfall Profits Taxes A Good Revenue Source?
Nobel Laureate Thomas Schelling on Windfall Profit Taxes

Tax Foundation Analysis and Studies
Oil Company Profits and Tax Collections: Does the U.S. Need a New Windfall Profits Tax?
Large Oil Industry Tax Payments Undercut Case for Windfall Profits Tax
State and Federal Treasuries “Profit” More from Gasoline Sales than U.S. Oil Industry
The Oil Excise Tax: Another Government Windfall
Impact of the Excess Profits Tax of 1952
Financing Defense: Is An Excess Profits Tax the Solution?
Excess Profits Taxation: A Compilation of Materials on Excess Profits Taxation

Studies from Other Organizations
Salvatore Lazzari, “The Windfall Profit Tax on Crude Oil: Overview of the Issues.” Congressional Research Service Report for Congress (September 12, 1990).

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

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