What do you believe and why?
I’m curious as to what you believe about “record oil companies profits.”
Do you believe what the left mainstream media tells you? Do you believe what the Senators and Congressman tell you about how “windfall profits” need to be taxed?
Do you believe that oil companies make the most profit on each gallon of gas? Do you believe the gas station owner makes most of the profits? Do you think that OPEC makes the majority of the money?
Hopefully this explanation will make things a little clearer.
Let’s start with what gasoline costs to make. The latest data available of course is outdated already with the recent drop in price per barrel of crude, but you will get the percentage idea.
As you can see, the bulk of the cost is in crude product, other wise known as OPEC profit. The next largest cost is distribution and marketing. Because the cost of crude went up so does transportation, by way of diesel costs (oil companies pay that increase too.) Transportation also includes transportation to refineries by way of ship or pipelines. A note on refineries…..we don’t have enough of them in our country to even refine the crude we produce in OUR country. The eco left has prevented that, it has not been the choice that the oil companies have made, and contrary to what the media wants you to believe.
Taxes amount to 13% of the product only, and later you will understand this term a little better. Finally 3% of the cost is from refining.
What the public doesn’t understand is this is from the production standpoint. These prices and percentages get it into the tanks at the gas station only. This is where the tax on tax idea comes to light. NOW we add the federal tax of 18.4 cents a gallon and an average of 29.2 cents per gallon from the states. It also needs to be said at this point that diesel fuel is taxed more per gallon on the federal side…….6 cents more per gallon! The government has lamely supported this extra tax on the lower sulfur content of the new diesel, even though the oil companies have to absorb that extra refining in their profits.
The left media screamed about the record sales Exxon-Mobil made in the third quarter this year. The figure was $14.8 billion, but what the uninformed don’t see is the operating costs involved. Exxon is taxed at a 43.3% rate, yes you read that correctly. In this same 3rd quarter they paid $11.3 billion in income tax, they paid $9.3 billion in sales tax. They paid $11.85 billion in other taxes, for a grand total of $32.51 billion for the third quarter of 2008.
You may ask now “how do they stay in business?” This is a good question. In this current business era, where we bailout financial institutions, brokerages, and now talk about bailing out auto companies. If because of the falling cost of crude oil continues and lower profits are on the horizon for them, will they be eligible? Why is it that Congress thinks they have the right to bastardize the oil industry, while collecting more profits from them then they are allowed to keep? They tend to pick and chose those industries in the private sector, that THEY deem worthy of OUR money.
I explain all these things to you, because there is a rumor floating around about raising gas taxes because the gasoline prices have fallen. Congress has never been known to let the economy get in the way of a good windfall profit for them, and this seems to be no exception.
I have included an open letter to Congress, that I hope you will cut and paste and send to your respective representatives to hopefully halt this talk of raised taxes on fuel.
I’m curious as to what you believe about “record oil companies profits.”
Do you believe what the left mainstream media tells you? Do you believe what the Senators and Congressman tell you about how “windfall profits” need to be taxed?
Do you believe that oil companies make the most profit on each gallon of gas? Do you believe the gas station owner makes most of the profits? Do you think that OPEC makes the majority of the money?
Hopefully this explanation will make things a little clearer.
Let’s start with what gasoline costs to make. The latest data available of course is outdated already with the recent drop in price per barrel of crude, but you will get the percentage idea.
As you can see, the bulk of the cost is in crude product, other wise known as OPEC profit. The next largest cost is distribution and marketing. Because the cost of crude went up so does transportation, by way of diesel costs (oil companies pay that increase too.) Transportation also includes transportation to refineries by way of ship or pipelines. A note on refineries…..we don’t have enough of them in our country to even refine the crude we produce in OUR country. The eco left has prevented that, it has not been the choice that the oil companies have made, and contrary to what the media wants you to believe.
Taxes amount to 13% of the product only, and later you will understand this term a little better. Finally 3% of the cost is from refining.
What the public doesn’t understand is this is from the production standpoint. These prices and percentages get it into the tanks at the gas station only. This is where the tax on tax idea comes to light. NOW we add the federal tax of 18.4 cents a gallon and an average of 29.2 cents per gallon from the states. It also needs to be said at this point that diesel fuel is taxed more per gallon on the federal side…….6 cents more per gallon! The government has lamely supported this extra tax on the lower sulfur content of the new diesel, even though the oil companies have to absorb that extra refining in their profits.
The left media screamed about the record sales Exxon-Mobil made in the third quarter this year. The figure was $14.8 billion, but what the uninformed don’t see is the operating costs involved. Exxon is taxed at a 43.3% rate, yes you read that correctly. In this same 3rd quarter they paid $11.3 billion in income tax, they paid $9.3 billion in sales tax. They paid $11.85 billion in other taxes, for a grand total of $32.51 billion for the third quarter of 2008.
You may ask now “how do they stay in business?” This is a good question. In this current business era, where we bailout financial institutions, brokerages, and now talk about bailing out auto companies. If because of the falling cost of crude oil continues and lower profits are on the horizon for them, will they be eligible? Why is it that Congress thinks they have the right to bastardize the oil industry, while collecting more profits from them then they are allowed to keep? They tend to pick and chose those industries in the private sector, that THEY deem worthy of OUR money.
I explain all these things to you, because there is a rumor floating around about raising gas taxes because the gasoline prices have fallen. Congress has never been known to let the economy get in the way of a good windfall profit for them, and this seems to be no exception.
I have included an open letter to Congress, that I hope you will cut and paste and send to your respective representatives to hopefully halt this talk of raised taxes on fuel.
Interesting link to gas taxes
http://www.marylandgasprices.com/tax_info.aspx
http://www.marylandgasprices.com/tax_info.aspx
Earnings and tax record
http://www.foxbusiness.com/story/markets/industries/energy/exxon-mobil-earnings-rise--setting-record/
What we pay for gasoline
http://tonto.eia.doe.gov/oog/info/gdu/gasdiesel.asp
________________________________________________________________________
Dear ,
I am deeply concerned with talk of increased taxes on gasoline and diesel fuels. We already pay a federal tax of 18.4 cents per gallon on gasoline and 24.4 cents for diesel. The very idea that diesel is 6 cents per gallon higher is detrimental to inflation, as most products in America are transported by diesel powered carriers. I feel that diesel tax should be lowered to the same tax of 18.4 as gasoline.
Talk of increasing the taxes to 40 cents through incremental increases is unacceptable. You already tax the oil companies to an extreme amount, keeping more money then they may keep in profits. Now you want to tax us on TOP of them, double taxation. When the economy recovers, (and it will,) the price of gasoline will increase, and we will be stuck with your tax increase regardless of the horrendous effect it will have on the average citizen. (We know you don’t give up taxes easily.)
Thank you for your time,
Sincerely,
3 comments:
Nobody has addressed this yet, I'm glad you did. Economic recovery can't happen unless the products can be delivered at a reasonable price.
I always thought that when a company posted it's earnings that was after all the expenses were accounted for...who knew???
Great information Al. I will send this on to many others....
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