EARTHblog » Lauren Pagel
By Lauren Pagel
January 26, 2011
I was heartened by the President s desire to end the massive subsidies we currently dole out to the oil industry, and invest in renewable energy. While we attempt to wean ourselves from all dirty energy sources, we need to end the subsidies, close the loopholes and institute policies that regulates fossil fuels in a way that best protects our communities and water resources.
By Lauren Pagel
January 25, 2011
Today, Senator Shaheen (D-NH) introduced the Elimination of Double Subsidies for the Hardrock Mining Industry Act, which would save U.S. taxpayers hundreds of millions of dollars by eliminating an outrageous tax deduction for the mining industry. In an era of budget cuts and calls for increased fiscal responsibility to reduce the federal deficit, giving double subsidies to exceedingly profitable industries is a move in the wrong direction and Senator Shaheen s legislation would finally end this ridiculous corporate tax break.
When you think of mining in the United States, the last thing you probably think of is the tax code. But, a provision in the tax code accounts for one of the largest subsidies received by the mining industry each year. This subsidy has a name that only the IRS could come up with the Percentage Depletion Allowance.
The Percentage Depletion Allowance, or PDA, permits a mining company to deduct a set percentage amount of its gross annual income when calculating its federal income tax, based on the fact that the value of its assets (the minerals in the ground) decline as mineral production progresses.
The PDA applies nationwide to mining operations on private and public lands, and constitutes an exceptional tax break for U.S. mineral producers beyond those granted to other private industries.