Windfall tax on Big Oil is a bad idea

Windfall tax on Big Oil is a bad idea

It’s difficult seeing your wallet drained by high gas prices, which everyone said was due to natural disasters constricting supply, and then hearing that oil companies had record profits last quarter. That just feels like somebody is profiting from disaster or using it as an excuse to raise prices. (Never mind that prices at the pump are lower now than they were before Katrina.)

Still the big profits (around $9-10 billion for several of the big companies) has led even Republican politicians to call for “windfall profit taxes.” It sounds good at first blush, but is really a bad idea.

How much profit is too much?

For one thing, who decides how much profit is enough? Do you want government bureaucrats and politicians (or more likely, their lobbyist friends) to begin deciding what constitutes “sufficient income”? Because if they can do it to one group, none of us are safe.

Written by
Domenico Bettinelli