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BP Oil Spill Costs Estimated To Cut Tax Bill By $10 Billion
Paging Alanis Morisette: BP just pulled the ironic rug from right under the feet of the US and UK - the company is now expected to pay $10 billion less in taxes as a result of oil spill costs and associated expenses. As the FT reports, "BP is forecast to pay about $10bn (£6.7bn) less tax over the next four years as it meets the costs of its huge oil spill in the Gulf of Mexico, hitting the revenues of Britain and the US that receive hundreds of millions of dollars from the company each year. The shortfall, representing a drop of more than a quarter in BP’s tax payments, is a particular concern for the British government attempting to cut the country’s budget deficit." It turns out the bulk of the tens of billions in associated costs will be tax deductible, in essence impairing primarily the government of the US and the UK at the marginal tax rate. And yes, both governments are in dire need of tax revenues, although the UK much more so, as the US apparently can print $30 billion on a day like today at a rate of just over 1%. It appears the endgame will be a truly poetic gesture with an extended middle finger by BP's treasurer. Of course once the UK realizes it is about to see billions see in taxes, the response will be yet another series of Obama bashing headlines, just like when it was made public that Scotland's widows are among the biggest losers in the stock price collapse.
More delightful irony from the FT:
If BP manages to seal the leaking well as planned by August, analysts have estimated that its total spending in the Gulf region could be about $30bn. That would represent about $10bn of clean-up costs and $20bn compensation for losses suffered by fishing, tourist and other industries, covered by the fund agreed with the US administration last month.
With a tax rate on profits of 33 per cent in a typical year, that would cut BP’s tax bill by about $10bn.
BP paid $8.4bn in worldwide tax on profits last year, down from $12.6bn in 2008 because of the fall in oil and gas prices.
Of that 2009 payment, £930m went to the British government: about as much as is paid by the UK’s entire transport and communications industries.
The company does not give a full geographic breakdown of its taxes, but its payments to the US are likely to have been of a similar size.
Irene Himona, an analyst at Exane BNP Paribas, estimated that before the Deepwater Horizon accident, BP was set to pay about $37.5bn in tax during 2010-13, but the costs of the disaster would cut that to $27bn.
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Deductions bitches.
Reminds me of the Citigroup 30 billion tax break which was equivalent to their TARP repayment.
That had to be part of the plan from the beginning - either that or the US government is just plain stupid and did not think of the possibility that BP could deduct its clean-up expenses.
Once again, we have been "had" by the kleptocrats.
EDIT: Maybe the IRS will rule they cannot deduct the expenses because they were the result of BPs own gross negligence and malfeasance.
Hey, it's a business expense.
Just likes bribes, errr, contributions, to The Squirrel.
Much worse news for the Brits. The U.S. looses the tax revenue too but at least a lot of that untaxed BP clean up money will be used to hire workers, services and equipment stateside.
I still think the UK makes a dramatic move to try and salvage value for their own citizen and institutional shareholders, sticking a finger in eye of a US federal agenda and legal attacks in the process.
The money expended by US Federal, State and Local agencies won't be paid for by BP either. The US taxpayer is also going to pay the long term cleanup costs.
Wait for this to HIT the U.K. Pension Funds...........U.K pensioners retirement funds are vested heavily thru/and by Investments in BP,and likely thru the Governemt.
OT a bit - wonder how much all of the "profits growth" of large corporations (not Main Street) these days is lowered tax rates, capital loss carryforwards and backs, pension plan contibution holidays, and lowered capital investments (see AA).
Of course, fundamental analysis doesn't matter anymore, but...
Were so foched...im now lunch for the middle class.
If there was ever any question that the interests of Big Government and Big Business are aligned...
It appears there is no distinction...more accurately it is probably described as a corporate plutocracy...next stop Plutarchy
http://www.youtube.com/watch?v=ZhwdkvfxlCY&feature=related
So bp doesn't want to pay taxes on profits it didn't make because it is facing 30B in costs... And y'all want to BLAME them for "sticking their middle finger" at the Government?
What, do you regard their money as belonging to you and when they have the gall to lose money in an accident you can't contain your envy and hate??
Sheesh!
The government breaks your leg, and hands you a crutch saying "see without me, you couldn't walk."
I think they are claiming to have capped the well. Where is GW?! Batsignal!
Doomsday: How BP Gulf disaster may have triggered a 'world-killing' event
http://www.helium.com/items/1882339-doomsday-how-bp-gulf-disaster-may-have-triggered-a-world-killing-event
:|
Just peachy!
There's tin, and then there's TIN. Why waste time theorizing over something we cannot predict, we cannot stop and we cannot survive?
The professor gave us the real story by email:
I also want to emphasize that in my theory, methane hydrates (clathrates) do not play any role.
Read more: http://www.businessinsider.com/gregory-ryskin-methane-2010-7#ixzz0tWgiByEk
You are correct Augustus, Ryskin didn't weight in on the diatribe in question...the author cited Ryskin's theory.
Ryskin’s methane extinction theory
Northwestern University's Gregory Ryskin, a bio-chemical engineer, has a theory: The oceans periodically produce massive eruptions of explosive methane gas. He has documented the scientific evidence that such an event was directly responsible for the mass extinctions that occurred 55 million years ago.
- and I do tend to agree with Ryskin's theory, he described how seawater can become "saturated" with methane, an can be vigorously released !, much like the fizz in a soda.
As you already know, 40% of the GOM oil blowout is methane...not hydrates, but hot, 500F methane.
Plop Plop Fizz Fizz
They just placed the 3 ram stack on top of the old BOP but most of the oil/gas is still being discharged into the gulf I think. They still need to hook-up to the manifold above the new stack in order to capture all the oil/gas.
http://bp.concerts.com/gom/sealingcapinstallationanimationwithkentwells070910.htm
By the way, there was not 2 pieces of pipe stuck in the BOP after all. Apparently they were only in the riser that had been cut off (?).
By the way, there was not 2 pieces of pipe stuck in the BOP after all. Apparently they were only in the riser that had been cut off (?).
I'm pretty sure Secretary Chu announced that he had run a special Nobel Prize scan on the BOP and there WERE two pipes in the BOP. He is Obama's man and in full control of the situation. There is simply nothing that he could be wrong about, heck, he is the Department of Energy and they know everything about energy.
What a trainwreck they have created in the Gulf, makes me sick... Literally :-/
I'm sure that J6P knows how to take advantage of expenses and deduction to minimize their taxes.
Why would anyone think that the smartest lawers and accountants working for BP would be too dumb to do the same.
jal
Don't the tobacco companies get to deduct their settlement payments every year?
Didn't know this - I'm sure it's true.
Why does BP pay taxes?
Oil companies pay bribes so they don't have to pay taxes.
I can only conclude that bribes have finally become more expensive than taxes.
Do people in Massachusetts even know or realize who it is they vote for during elections? First they put the ignorant Barney Frank in office. Then they vote Scott Brown in, who has lied about every position he ever claimed to stand for, and has voted for every single democratic piece of worthless legislation that has been sent to the floor. First he claims against it, then gets his payoff from the lobbyists, then votes for it. This guy is the worse kind of all. Should we ban Mass. from future elections, they obviously have no clue.
While we are at it, lets ban those who fall victim to confirmation bias.
Oh and ban anyone who voted for someone that told them what they wanted to hear but changed their mind once they got elected.
Rarely Seen Pictures Of The Devastating Consequences Of The BP Disaster
All photographs and text are copyright of their respective owners. They are being reproduced under the Fair Use exception to copyright law, 17 U.S.C. § 107, as it is for educational purposes and is intended as political commentary on important social events of the day.
In addition, use of such images is also protected under the First Amendment to the United States Constitution. Specifically, reproduction is protected under the "Mai Lai/Zapruder line of cases", since:
I must be a total wussy, still crying after following that link.
So they'll just borrow the 10 billion. No biggie (rolls eyes).
At least this way, the MONEY WILL BE APPROPRIATELY APPORTIONED to the victim.
Instead of a politically fiscal "financial drug addict" whore addicted to money from other parts of the country.
TO FUCKIN BAD DETROIT... These spoils is stayin in the DELTA..
BITCH!!!!!!!
No; the spoils are staying in the hands of the companies who steal and plunder them from all of us.
Which includes BP, along with the banks. Not a penny should go to either.
In fact, the only thing that should be going to these people are bullets - traveling at great velocity . . . at short range.
Just like the one that killed Oscar Grant. Funny how BP execs never get such treatment from cops.
Rusty...
That's some truly scary shit - Jesus help us all...if it's true!
Still i'm a big Python fan - so altogether now...
'Always look on the bright side of life...'
...Oh right - we crucified the previous applicant...bummer!
On a veranda in Caracas, Chavez snickers.
It really is great to read the posts of the complainers. They had really, really, really already spent the money that BP was supposed to give to them. Where will they find a new tit to suckle? Will Obama have to stop making their house payments for them?
Now, after slobbering and ranting about corporations never paying taxes, they find out that they were full of nonsense. And, since BP does pay taxes, the outrage is that they can actually deduct costs and expenses from revenues before haveing a profit. I suppose the mouth breathers thought that BP just simply generates those revenues without cost, using the same source that Obama uses to send them their monthly pay-per-vote money. Welcome to reality, Libtards.
Quite the laudable stand, Augustus, defending the company that ruined the Gulf of Mexico for the billion or so people for whom it helps to sustain. I'm sure your mom is quite proud.
Whatever BP 'pays' in 'taxes', they more than get back in the massive interference run by Barry and the Boys in DC.
To defraud the public, externalizing all the death and devastation resulting from their plunder, BP needs real allies to do the real wetwork. That's why they buy politicians. That's what Capitalist governments are for.
And that's what you're for - welfare capitalism.
You buy locally produced gasoline, I suppose. You and bubba go to camel land and bring back a few gallons and cook it up your self?
It takes a lot of capital to keep that system delivering. They pay extra income taxes when they are profitable at it. Otherwise, it is just state taxes, sales taxes, highway taxes and royalties that they collect from you and pass on the the different entities.
So, in you mind, companies which pay taxes are collecting welfare. Then people who actually collect a check for video game playing must be thieves? I guess that must be right on.
USA is in deep oil idolatry.
That is the cause of all this mess.
"The US" didn't rip up public transit and addict the planet on cars.
Specific people did, to satisfy their thirst for blood and plunder.
Since we are all considered individual corporations who are slaves to the U.S why wouldn't we all get a tax break on all the dumb shit we have done in our lives?? It took money to clean up our mistakes A NICE TAX CUT WOULD BE NICE! instead while I live in CALIFORNIA I pay the cost of the States mistakes along with the mistakes of all the dam people on welfare ect.. FML!! I guess ill need to document the cost of every mistake I make, the cost and labor it took to fix, and tell the state to GO FUCK THEMSELVES!!! because BP did it!!..
No secrets to success RIGHT!! it is the result of hard work, preparation and learning from failure..
BP is on welfare.
Along with Apartheid Israel.
BP is a FUCKN WHORE!! on welfare with clamidia and HPV all rolled in ONE!! an invisible virus sucking our econemy dry for years to come.. Our econemy is already in a $hit hole and BP is going to Fuck us DRY!!! They are trying to fuck us in the ear because they have no other hole to fuck!! at least they can spit on it.. NOOO THEY WANT IT DRY!!
Im calm now..
And Citibank.
I don't see a problem . Quitcherbitchin already . Or give up your allowable tax writeoffs for losses , investment losses anyone? Home fire , flood , act of God uninsured losses? The whining is getting real old real fast .
well, one thing they could do it compell BP to spread the tax deductions for the cleanup costs over 5 years or longer - that way, the hit to public coffers will not be so extreme. I think there is a good case to compell them to spread the tax deduction over a time period - we will be seeing the ramifications of this spill for years to come, and it will allow the company to appear more profitable in this year - and appearing profitable was a good thing for all those unprofitable companies in the 90s bubble, so it has to be good for BP too;)
I'm sure they can carry back three years, and maybe five, as approved by Obama to help out companies in the recession. I doubt that they can actually spend enough in a year on this to drive the whole company negative for a year. but I guess it it could happen for the year with any monster fines.
Now if only there was any real clean up going on and money was actually being paid to the people working in "fishing, tourist and other industries".
As long as you have a tax system based on 'profits' this is completely legit. I personally think that system sucks and was designed to keep the power elite in place. BUT - it's the system you want so live with it.
Why should anyone be surprised at this? Taxes are paid from profits. $30 billion less profits from a spill is going to mean less taxes.
Now what isn't tax deductable are criminal penalties. That's going to be the interesting part.
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