Energy groups pan tax reform draft

The oil-and-gas industry and other parts of the energy sector have let the Senate’s top tax writer know they’re no fans of his tax reform plans.

The American Petroleum Institute and more than a dozen other groups say that Senate Finance Chairman Max Baucus’s recent draft discussion would hurt their abilities to recover costs and invest in the economy.

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A draft discussion released by Baucus (D-Mont.) would roll back a tax break that allows companies to write off property more quickly than it depreciates, and an accounting method known as “last in, first out,” or LIFO.

Energy producers have said that tax provisions that allow them to quickly recover costs are perhaps even more important than the lower rates offered by potential tax reform plans.

“Throughout the economic downturn, America’s oil and natural gas industry has provided one of the few bright spots as the economy struggles toward recovery. The industry has invested hundreds of billions of dollars to develop our nation’s oil and natural gas reserves, expand our refining capacity and develop innovative new technologies to meet the energy demands of a growing economy,” the groups wrote.

“This investment has created tens of thousands of high paying jobs and billions of dollars in new revenue for the government. These are exactly the types of investments tax policy should encourage and support.”

Baucus said Friday he would release “a couple” of tax reform drafts next week, with energy among the expected topics.