While the Senate failed May 17 to approve a Democratic bill to impose a discriminatory tax increase on the companies that produce America’s oil and natural gas and that manufacture fuels and petrochemicals, White House Press Secretary Jay Carney said after the vote that “the administration will continue to pursue this important reform.” And Senate Democratic leaders said they would seek approval of the tax increases again in talks with Republicans and the White House on deficit reduction.

But instead of bringing federal, state and local governments more money, the energy tax increases favored by President Obama and his congressional allies would bring government a lot less money.

How?

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Imposing what would amount to a multibillion-dollar energy tax hike would increase operating costs for American companies producing oil and natural gas, fuels and petrochemicals. This would give foreign companies an unfair competitive advantage – thereby increasing the amount of these products produced abroad and reducing the amount produced in America. American companies would then earn less, pay less in taxes and employ fewer workers – costing all levels of government billions of dollars in lost revenue.

The way to get more money from companies in the oil and natural gas sectors is to allow them to produce more in the United States. There has never been a case in history, as far as I know, of a tax increase prompting a company to produce more and lower prices on its products.

We need more production of oil and natural gas in the U.S. and off our shores to make America less reliant on foreign suppliers, create millions of American jobs, increase our national security, reduce our trade deficit and bring in billions of dollars in new tax revenues.

America isn’t energy poor – we’re energy rich, with some of the largest oil and natural gas deposits in the world. Government should let American companies get these resources – in an environmentally sound manner – to supply the American people with the energy they need. No other nation puts restrictions like America’s on access to its own oil and natural gas.

The federal government can take other actions as well to build a better energy future.

The State Department needs to approve the Keystone XL pipeline, which would bring up to 1.1 million barrels of Canadian oil to the United States every day. If we won’t buy Canadian oil, Canada will sell it China and other countries in Asia.

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In addition, the Environmental Protection Agency needs to end harmful regulations on greenhouse gas emissions that will raise energy costs and do nothing for the environment.   

These practical steps would bring billions of dollars more in oil company taxes to governments, create millions of American jobs and strengthen our economy and national security.

President Obama and others have repeatedly – and inaccurately – referred to the tax deductions they want to remove as “oil company subsidies.”

But companies in the oil and natural gas sector don‘t get subsidies. They simply get the same type of tax deductions other businesses get.

American oil and natural gas producers and fuel and petrochemical manufacturers already pay hundreds of billions of dollars in federal, state and local taxes and don’t get a penny in government subsidies. The companies ask for no special treatment – only fair treatment.

No one wants to pay $4 or more for a gallon of gasoline. So it’s tempting – and understandable – that some Americans view the companies that provide our nation with vital products they use every day as villains that need to be punished with higher taxes.

But oil companies don’t set the price of oil and natural gas – the price is set by the worldwide commodities markets.

Crude oil accounts for about 70 percent of the cost of gasoline, with another big chunk going to pay taxes and the rest paying for the cost of refining and marketing. And the price of fuels has not risen as far as the price of crude oil, meaning that the companies that refine and market gasoline have absorbed part of the oil price increases without passing them on to customers.

Instead of singling out one sector of our economy and the people who hold the 9.2 million jobs it supports for unfair and discriminatory tax treatment, our leaders should be working to develop an energy policy that is focused on serving the American people.

We stand ready to work with them and have an intellectually honest dialogue about how to build a stronger economy, a brighter energy future and a more prosperous America.

Charles T. Drevna is president of NPRA, the National Petrochemical & Refiners Association.