House thwarts Dem bid to kill oil tax breaks

By Ben Geman and Mike Lillis - 03/01/11 05:59 PM ET

House Democrats on Tuesday used debate on a short-term spending package to force a largely symbolic vote on ending tax breaks for major oil companies like Exxon and Shell.

The "motion to recommit" failed on a mostly party-line vote, but it will provide Democrats a hook to accuse Republicans of catering to “Big Oil” at a time of rising gasoline prices. Motions to recommit are a procedural mechanism that allow the minority party a chance to alter bills.

The underlying two-week spending package passed the House easily.

Rep. Bill Keating (D-Mass.), who sponsored the oil tax proposal, wondered why taxpayers should be asked "to fork over" billions of dollars in subsidies to some of the most profitable companies on the planet — particularly as funding for law enforcement, medical research and education is on the chopping block.

"Let's put a stop to this welfare program for big oil," Keating said on the House floor.

But House Appropriations Committee Chairman Hal Rogers (R-Ky.) slammed the Democrats' proposal, arguing it would single out one industry "and increase their cost of doing business."

"This misguided policy can only lead to higher energy prices, continued reliance on foreign oil and economic hardship that hampers job creation," Rogers said.

The motion would have removed two weeks’ worth of incentives, according to Minority Whip Steny Hoyer’s (D-Md.) office, including the industry’s eligibility to claim a deduction on income from domestic manufacturing.

The Democrat’s proposal would have sent the two-week spending package back to the Appropriations Committee, with orders to redraft it with provisions ending the incentives.

The vote was 176-249. Thirteen Democrats opposed it, and no Republicans voted for the motion.

A spokesman for House Minority Leader Pelosi (D-Calif.) said that had the motion passed, it would have laid the groundwork for a longer repeal of the tax breaks.

“If it had passed ... and we did another extension of the same CR [continuing resolution], it would’ve carried through for the duration of the next CR. So it was tied to the underlying date that keeps getting amended,” spokesman Drew Hammill said in an e-mail.