Bush Opposes Tax Break Ban in Exxon Spill

The Bush Administration today opposed a bill aimed at denying Exxon Corp. a tax deduction for costs of cleaning up the Alaska oil spill.

“The bill would violate the fundamental principle of business taxation that a taxpayer’s ordinary and necessary business expenses may be deducted in computing net income,” Kenneth W. Gideon, assistant Treasury secretary for tax policy, told the Senate Finance Committee.

Sen. Harry Reid (D-Nev.), sponsor of the bill, said: “I do not want to tell my constituents that the American people owe Exxon, the biggest polluter in history, millions of dollars in a tax rebate in return for destroying the environment and raising prices at the gas pumps.”

Credit Cards Mailed In

Waving a handful of Exxon credit cards that irate customers had mailed him in protest, Reid added:

“Given the company’s dismal cleanup performance and the resultant permanent scar that now defaces Alaska’s beauty, it is incomprehensible that Exxon should be able to claim its cleanup costs--estimated at $500 million--as an ‘ordinary and necessary’ cost of doing business.”

A large share of Exxon’s cleanup costs apparently are covered by insurance. Under present law, any uninsured share could be deducted from taxable income as a cost of doing business.