U.S. Senate Passes The Tax Relief Act of 2005

House Fighting for WOTC

IRS Fuel Credit Draft Form

Energy Independence Bills Introduced

SIGMA Winter Leadership

METH Bill Compromise

Transportation Security Legislation Approved

SIGMA Spring Convention

California Needs Clarification

Senate Rejects Superfund Tax

EPA Releases Final Detergent Rule

SIGMA in Breckenridge, CO

U.S. SENATE PASSES THE TAX RELIEF ACT OF 2005
The Senate passed the "Tax Relief Act of 2005" (S. 2020) early Friday morning by a vote of 64-33—but not before significant debate and "fireworks" on several amendments of significant interest to the oil industry in general and independent marketers in particular.  The Senate debate on the nearly $60 billion tax reconciliation bill included three amendments of importance to SIGMA members.  First, the Senate voted down an integrated oil company windfall profits tax proposal by a vote of 35-64.   This amendment, sponsored by Sen. Byron Dorgan (D-ND), would have imposed a temporary windfall profit tax on sales of crude oil over $40 a barrel and rebated the tax collected back to the American consumer.  Second,  Sen. Maria Cantwell (D-WA) offered an amendment to establish a federal definition of motor fuel "price gouging,"  classifying a violation of this definition as an unfair trade practice to be enforced by the Federal Trade Commission and state attorneys general,  and authorizing significant civil and criminal fines for violations.  The Senate voted down the Cantwell amendment by the tight margin of 57-42—under the Senate procedure for the amendment, it required 60 votes for adoption.   

SIGMA expressed strong opposition to the Cantwell amendment.  Despite the fact that this amendment was defeated, it is not comforting that such a fundamentally unsound amendment garnered 57 Senator’s votes, a mere 3 away from the 60 votes needed under budget rule.  Finally, S. 2020 includes a provision that would prohibit "integrated oil companies" (defined as companies that produce crude and have over 50,000 b/d of refining capacity or produce crude and retail finished products) with over $1 billion in revenue in 2005 from using the last-in, first-out (LIFO) method of accounting that assumes that the last goods brought into a company’s inventory are the first goods sold to third parties.  This provision was amended on the Senate floor to exempt all integrated oil companies from the LIFO provision that produce less than 500,000 b/d of crude worldwide. This floor amendment would exempt all but the largest integrated oil companies from this accounting change mandate.    
Back to top

HOUSE FIGHTING FOR WOTC
The House is also working on a $56.6 billion tax reconciliation bill which includes a number of extension provisions, one of which SIGMA members value greatly.  House members are seeking to extend the Work Opportunity Tax Credit (WOTC), a tax provision that allots credit to employers for hiring workers who struggle financially, for example.  The House Ways and Means Committee voted just before midnight Tuesday to approve a slightly slimmer version of the Senate’s Tax Relief Act of 2005 that included WOTC.  The House and Senate appropriation committees could go to conference as soon as Friday night to battle out some vast differences in the bills.  Congress will break for a Thanksgiving recess on Saturday and return the first full week of December to address any unfinished business.  SIGMA will keep you abreast of the important issues affecting you most.     

Back to top

IRS FUEL CREDIT DRAFT FORM
The IRS announced an advance copy of the Diesel and Biodiesel Fuel Credit tax form, number 8864, on Monday available online at http://www.irs.gov/pub/irs-dft/d8864.pdf  If you have any comments on this draft form, you can submit them within 30 days to the IRS on its web site, www.irs.gov 
Back to top

ENERGY INDEPENDENCE BILLS INTRODUCED
A bipartisan group of legislators in the House and Senate introduced legislation (S. 2025 and a similar bill planned in the House) on Wednesday to speed development and use of alternative fuels such as ethanol and to reduce the nation's dependence on foreign oil. The legislation would set national goals for saving 2.5 million barrels of oil a day by 2015 in the House bill and by 2016 in the Senate measure.  Touted for its actions to decrease dependence on foreign crude oil, the bill is gaining support. SIGMA has not taken a position on the measure, but supports a provision in the bills that would lift tariffs on ethanol imports, currently at 51-52 cents per gal.
Back to top

SIGMA WINTER LEADERSHIP
Now is the time to sign up for this year’s Winter  Leadership Conference! The meeting will take place in Denver, CO on January 19-20, 2006, in advance of the NPN/SIGMA Executive Leadership Conference at Winter Management.
Back to top

METH BILL COMPROMISE
SIGMA expects the House and Senate to pass a compromise proposal to regulate the retail sale of methamphetamines as part of the effort to reauthorize the PATRIOT Act, which will allow retailers to sell cold medicines without having a pharmacy onsite.    Retailers will be required to keep a log of all sales of all products containing these chemicals which must include, the product sold, name and address of purchaser, and the date and time of sale.  They must also keep products behind the sales counter or in a locked cabinet to prevent direct access to the products by consumers.  For their part, purchasers will only be permitted to purchase the product if they present a state or Federal government issued photo identification card and will be required to sign and legibly print their name in the logbook.  The new compromise package includes an exemption from the log requirement for sales of single dose packages.  Details on this proposed compromise will be covered in next week's Weekly Report.
Back to top

TRANSPORTATION SECURITY LEGISLATION APPROVED
The Senate Commerce, Science, and Transportation Committee approved S. 1052 on Thursday, authorizing $19.34 billion in funding for security upgrades for all modes of U.S. transportation including port, rail aviation, motor carrier and shipping hazardous materials. Senate Commerce Committee Chairman Ted Stevens (R-AK) along with Ranking Member Daniel Inouye (D-HI) and Sen. Jay Rockefeller (D-WV) introduced the bill, which combines many proposals previously approved by both the Commerce Committee and the full Senate and focuses mainly on port and rail security upgrades.   
Back to top

SIGMA Weekly Report November 21, 2005 © Copyright SIGMA, 2005