During the March 26 edition of Fox News' Fox & Friends, Fox Business' Stuart Varney argued that tax deductions for oil companies should be maintained, claiming that the tax breaks were not extraordinary because "every company in America gets a tax break when they buy equipment." Varney also accused president Obama of "attacking the oil companies because they are very profitable" and singling out the oil industry over other parts of the manufacturing sector.
VARNEY: The use of the word subsidy is wildly misleading. There' is no payment that goes from the treasury to the oil companies. It doesn't work like that. Every company in America gets a tax break when they buy equipment. Ok?
STEVE DOOCY (co-host): Sure
VARNEY: Because we want to encourage--
DOOCY: It's a deduction.
VARNEY: Investment in equipment, expansion and efficiency. It is a deduction. The president calls it a subsidy as if there's money going out of the treasury straight to the oil companies. Absolutely not true.
GRETCHEN CARLSON (co-host): So it's the same thing for all companies?
CARLSON: And the reason that we talk so much about this is because of gas prices and because oil companies make a big profit.
VARNEY: The president is attacking the oil companies because they are very profitable, they do make a great deal of money--
KILMEADE: They pay a great deal of taxes.
VARNEY: He is going right after them, and says they should pay more in taxes. That is his solution to rising gas prices. Do you think you are going to get lower gas prices because you take an extra $4 billion a year off the oil companies? I am not sure that is going to work out. [Fox News, Fox & Friends, 3/27/12]
During the segment the on-screen graphic referenced the "oil bill" better known as S.2204, the Repeal Big Oil Tax Subsidies Act:
[Fox News, Fox & Friends, 3/27/12]
But contrary to Varney's claim, oil companies enjoy several unique deductions that other companies in other industries do not, many of which are directly targeted by the bill. As a March 26 Senate Republican Policy Committee press release makes clear:
S. 2204 incorporates an earlier legislative effort to extend expired and expiring tax expenditures for renewable energy, alternative energy, energy efficiency, and mine safety training equipment. The bill is paid for by repealing certain oil and gas tax incentives. The Act:
repeals or modifies certain oil and gas tax incentives: dual capacity rule, Section 199 domestic manufacturing deduction, intangible drilling and development cost deduction, percentage depletion allowance for oil and gas wells, tertiary injectants deduction, Outer Continental Shelf deep water and deep gas royalty relief