Democrats reckless tax and spend spree raises energy taxes by more than $21 billion, hitting American consumers in the form of higher gas prices and energy bills.
These energy tax hikes are a clear violation of President Biden’s pledge not to raise any form of tax on anyone making less than $400,000 per year. Officials within the administration have repeatedly admitted taxes that raise consumer energy prices are in violation of President Biden’s $400,000 tax pledge.
On June 21 of last year, Biden’s Press Secretary Jen Psaki stated:
“The President’s pledge was not to raise taxes on Americans making less than $400,000 a year. And the proposed gas tax or vehicle mileage tax would do exactly that. So that is a nonstarter for him.”
On February 26 of last year, Biden’s Transportation Secretary Pete Buttigieg stated:
“The President’s made a commitment that this administration will not raise taxes on people making less than $400,000 a year… so that rules out approaches like the old-fashioned gas tax.”
Now Democrats and President Biden are breaking this promise to Americans and pushing energy tax hikes on consumers at time when total energy prices have increased by 40 percent in the past year. Below are the tax hikes in the Democrat bill.
$ 12 Billion Tax Hike on Oil
With gas averaging more than $4.00 per gallon across the country and only weeks removed from record-high prices, Democrats have included a 16.4 cents-per-barrel tax on crude oil and imported petroleum products. This tax will be paid by consumers in the form of higher gas prices.
Costs estimates from the Joint Committee on Taxation (JCT) project the provision will be a $12 billion tax hike.
As if it weren’t bad enough, Democrats have pegged their tax increase to inflation. As inflation increases, so will the level of tax. Here it is straight from the bill text:
ADJUSTMENT FOR INFLATION.—
“In the case of a year beginning after 2023, the amount in paragraph (2)(A) shall be increased by an amount equal to—
‘‘(i) such amount, multiplied by
‘‘(ii) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year, determined by substituting ‘calendar year 2022’ for ‘calendar year 2016’ in subparagraph (A)(ii) thereof.”
$8 Billion Natural Gas Tax
The legislation would impose a regressive tax on oil and gas development based upon emission levels of methane during production, leading to higher energy bills for consumers and higher costs of everyday products. This provision was included in Democrats’ House-passed reconciliation bill and scored by the Congressional Budget Office to raise taxes by $8 billion.
A letter to Congress from the American Gas Association warned that the methane tax would amount to a 17% increase on an average family’s natural gas bill. Democrats have included a tax in the bill despite retail prices for energy surpassing multi-year highs in the United States.
$1.2 Billion Coal Tax
The bill would more than double current excise taxes on coal production. Under the Democrat proposal, the tax rate on coal from subsurface mining would increase from $0.50 per ton to $1.10 per ton while the tax rate on coal from surface mining would increase from $0.25 per ton to $0.55 per ton.
JCT estimates that this will raise about $1.2 in taxes that will be passed on to consumers in the form of higher electricity bills.