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As part of his 2010 budget, President Obama has proposed eliminat- ing billions of dollars in federal subsidies and giveaways to oil and gas companies. The money saved by eliminating these subsidies would be used to encourage clean and renewable sources of energy and to cut taxes for American families. These giveaways, if continued, would cost taxpayers in every state more than $30 billion over 10 years. This table shows how much taxpayers in each state will pay to finance giveaways to oil and gas companies unless President Obama is able to eliminate them in his budget.
The giveaways and tax breaks that stand to be eliminated include the oil and gas depletion allowance, which lets oil companies deduct 15 percent of their sales revenue; the “manufacturing” tax deduction, which allows oil companies to treat extracted oil as a “manufactured” good; the “intan- gible drilling costs” deduction; the deduction for the “geological and geophysical expenditures;” and allowing oil and gas companies to drill on public lands in the Gulf of Mexico without paying a fee.