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BP Passes the Buck to Taxpayers

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July 27, 2010 – Comments (4)

LOS ANGELES (MarketWatch) -- BP PLC will reduce its contribution to U.S. coffers by roughly $10 billion due to a tax credit the company is claiming it incurred from the Gulf of Mexico oil spill.

The oil giant said Tuesday that it is incurring a charge of $32.2 billion from the Deepwater Horizon disaster response, and as such, it is claiming a $9.9 billion taxation credit.

Asked in a conference call Tuesday about whether it has discussed the tax credit with President Barack Obama's administration, BP's outgoing chief executive, Tony Hayward said: "We have followed the IRS regulations as they're currently written."

  ... The company has agreed to put $20 billion in an escrow account to pay claims for oil-spill damages ... But half of that may now come out of government coffers, and it could prove to be embarrassing for the Obama administration

More: 

http://www.marketwatch.com/story/bp-taking-10-billion-tax-credit-from-spill-2010-07-27?dist=afterbell 

4 Comments – Post Your Own

#1) On July 27, 2010 at 5:13 PM, Teacherman1 (57.58) wrote:

It will balance out. The government hasn't fined them for the spill yet.

As an aside, does anyone else find it interesting that the new CEO to be, actually had more direct oversite and therefore responsibility for the spill than Hayward did.

Just a thought. 

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#2) On July 27, 2010 at 5:18 PM, ag77840 (23.10) wrote:

I think the main issue regarding Hayward is the US public's poor perception of him as arrogant and aloof. 

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#3) On July 27, 2010 at 6:55 PM, TDRH (99.65) wrote:

Arrogant, aloof, and basically quite juvenile.    The BP engineers could not have been telling him that it was leaking 5000 barrells per day....

 He seems to know his taxes though, glad to know he is good for something.   His timing and his wording  as Teacherman1 stated may have been poor.   "We have followed the IRS regulations as they're currently written."   The Obama administration does not care about regulations or laws when it comes to this spill.   They make up the rules as they go along. 

Meanwhile rigs and crews are idle or moving out of the Gulf area.

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#4) On July 28, 2010 at 8:42 AM, rd80 (98.26) wrote:

$10 billion tax credit / $32 billion hit to earnings = 31% tax rate.
Sounds about right.

 

 

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