Rep. Katie Porter (D-CA) excoriated an oil company’s executive during a congressional hearing Tuesday after he suggested she did not understand a tax break under discussion. Speaking to Mark Murphy, president of Strata Production company, the chair of House Natural Resources Oversight Committee said, “How much of those intangible drilling costs do you get to deduct right away from your taxes?” Murphy responded, “We get to deduct all of those just like any other business. There seems to be a misconception out there that you’re operating from that somehow the oil and gas industry benefits from some special sort of tax structure. We don’t.”
To which Porter replied, “You do benefit from special rules. There’s a special tax rule for intangible drilling costs that does not apply to other kinds of expenses that businesses have. You get to deduct 70 percent of your costs immediately, and other businesses have to amortize their expenses over their entire profit stream, so please don’t patronize me by telling me that the oil and gas industry doesn’t have any special tax provisions. Because if you would like that to be the rule, I would be happy to have Congress deliver.”