Did you know that the federal government’s tax on gasoline is greater than the profit that the oil companies make by selling it? In other words, the government makes a greater profit from the sale of gasoline than the companies who produce and market it. Think about that the next time somebody starts yapping about how “obsene” the profits being made from gasoline sales are, and how we need to raise taxes on the oil companies.
While the media continues to blame the big oil companies for gouging U.S. motorists as they collect record breaking profits, the windfall profits raked in by the government in the form of energy tax revenue actually dwarf the oil companies’ jackpot.
The press sounded the alarm last year when the largest U.S. oil company, ExxonMobil Corp, announced profits of $36 billion. But according to the Tax Foundation, the biggest price gouging profiteer was the U.S. government, cashing in to the tune of $54 billion in oil and gas taxes.
“Tax collections on the production and import of gasoline by state and federal governments are already near historic highs,” the think tank says. “In fact, in recent decades governments have collected far more revenue from gasoline taxes than the largest U.S. oil companies have collectively earned in domestic profits.”
Since 1977, federal and state governments have collected more than $1.34 trillion in gasoline tax revenues in inflation adjusted dollars. That’s “more than twice the amount of domestic profits earned by major U.S. oil companies during the same period,” the Tax Foundation says.
