S. 4604, Oil and Gas Tax Subsidy. Quorum's AI analysis reads it as a net cost — and names who bears it.
S. 4604 · Net cost
What it does
This bill modifies tax depletion allowances for small oil and gas producers, increasing the percentage depletion rate they can claim on marginal wells from a baseline of 15% up to 25% depending on crude oil prices. It removes income-limitation caps on these deductions and adjusts the threshold annually for inflation, effectively allowing small producers to deduct more of their well costs from taxable income when oil prices are low.
The analysis names small and mid-sized oil and gas producers — and 2 more groups — among the beneficiaries.
The cost
The inflation-adjustment mechanism (PPI adjustment) creates an open-ended, self-adjusting tax subsidy that will grow automatically without future congressional action, reducing fiscal transparency.
The analysis put a high warning level on this bill. Transparency scores 35%, and the analysis found no provisions unrelated to the bill's subject.
Who is behind it
Filed by Roger Marshall. Cosponsored by Bernie Moreno, Bill Cassidy, Dave McCormick and James Lankford.