Repeal of $2B in oil company tax breaks fails in Senate

5/17/2011

WASHINGTON — The Senate has blocked a bill to repeal about $2 billion a year in tax breaks for the five biggest oil companies, a Democratic measure meant to respond to huge industry profits and $4-a-gallon gas prices.

The bill was defeated Tuesday on a procedural vote, but Democrats hope to revive the measure later this year when lawmakers and the Obama administration negotiate a deficit-reduction package.

Republicans and some Democrats opposed the tax increase, saying it would hurt domestic drilling while doing nothing to reduce gas prices. The measure would have affected Shell Oil Co., ExxonMobil, ConocoPhillips, BP America and Chevron Corp.

A GOP measure designed to increase offshore drilling is scheduled for a Senate vote on Wednesday, though it is not expected to pass, either.