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Republicans Want to Re-Open a Tax Loophole That Benefits Fossil Fuel Companies

The GOP plans to void a rule that stops oil, gas, and coal companies from artificially depressing their royalty rates.

For decades, American coal companies exploited a loophole in the federal coal program that allowed them to dodge royalties and shortchange taxpayers. These fossil fuel giants avoided paying up to $850 million in government returns between between 2008 and 2012, through a network of subsidiaries and cost manipulation, at the expense of the average American. Last year, the Office of Natural Resources Revenue (ONRR), a small agency within the Department of the Interior (DOI), successfully closed the loophole. And now, Republicans are fighting to open it again. The sweeping rule, proposed by the DOI under Secretary Sally Jewell and called the "Consolidated Federal Oil & Gas and Federal & Indian Coal Valuation Reform," required oil, natural gas, and coal companies to pay royalties to taxpayers on the actual market value of their commodities. The rule would also make the valuation process more transparent, and was part of a larger effort to modernize America's aging federal coal program. GOP members say the reform "places undue accounting burdens on US energy producers." The joint resolution (H.J. Res. 71) to void the ONRR rule was introduced by Rep. Scott Tipton (R-CO) this week. He and 11 co-sponsors, all from leading fossil fuel states, are using the Congressional Review Act to roll back the "midnight rule," or regulation creation during the Obama administration's final months. Read more on Motherboard

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