On Monday, March 21, a gasoline price board is displayed at a gas station in Menlo Park. Legislators in Congress are investigating methods to return part of the money to consumers.
Will Californians receive $100 in monthly fuel refunds from Washington, in addition to the gas relief funds that state authorities want to give to consumers?
Congress is debating whether to approve a government gasoline stimulus payment of $100 per month per person and $100 per dependent. The funds would be distributed to the majority of people living in places where the national average fuel price is more than $4 per gallon. These places would include California, where the Friday average was $5.90 per gallon, by far the highest state price in the country. One of the effort’s organisers is Rep. Mike Thompson, D-St. Helena. His approach would adhere to the same rules as the federal economic stimulus funds made last year.
That means that single taxpayers earning less than $75,000 may be eligible for the $100. It would gradually phase out for those earning up to $80,000 per year.
After that, the benefit would be phased out at $160,000. Californians who meet the requirements could get both a state and a federal payment. Thompson chairs the House Ways and Means Committee’s select revenue subcommittee, which gives him power in crafting legislation.
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The most important is where the money for payments originates from. Thompson hasn’t figured out how to pay for the rebates yet, and he doesn’t know how much it will cost. “We considered a few other options. “We determined it was critical to get the law in,” he added, while considering alternative ways to pay for the plan. Choosing amongst those options could be challenging.
Senator Alex Padilla, D-Calif., is one of those advocating for the The Big Oil Windfall Profits Tax Act. It would impose a per-barrel tax equivalent to 50% of the difference between the present price of a barrel of oil and the pre-pandemic average price per barrel on large oil corporations that produce or import at least 300,000 barrels of oil per day. Profits would be distributed to qualifying customers in the form of a quarterly refund.
The income limits would be the same as Thompson proposed. Duration of the video: 1:27 Because of Russian oil sanctions and COVID-19 limits, gas prices have risen to a record high across the United States.
The senators calculate that if the price of oil is $120 per barrel, the tax would raise approximately $45 billion per year, which would mean that single filers would receive approximately $240 per year and joint filers would receive almost $360. Crude oil reached a high of $120 per barrel earlier this month and has subsequently ranged between $110 and $115 per barrel.
In 1980, the government imposed a windfall gains tax on large oil, and a Congressional Research Service assessment in 2006 concluded that a new tax “may have various detrimental economic implications,” including lowering domestic oil output. Thompson is examining additional options, including as placing greater taxes on countries who do not support the sanctions imposed by the US and its allies on Russia.
Other lawmakers have discussed suspending the federal gasoline tax of 18.4 cents per gallon, but progress has halted due to worries that there are no guarantees that oil corporations and service stations will pass the savings on to consumers.
The rebate concept has sparked interest since it avoids this issue, however it is still met with suspicion. Alex Muresianu, a federal policy analyst at the nonpartisan Tax Foundation, was concerned that the rebate will contribute to the continuation of price hikes. “It’s fairly evident that inflation is extremely high, and another stimulus payment will almost certainly push it much higher,” he said. Another point of contention was addressed by House Transportation and Infrastructure Committee Chairman Peter DeFazio, D-Oregon. “A sizable proportion of the population does not drive.
“There’s no way to tell who buys gas and who doesn’t,” he explained. Supporters argue that increasing energy prices are reflected in the cost of more than just gasoline, since they are transmitted through to the cost of food, housing, and nearly any other area where energy is required. The $100 a month, supporters suggested, might help those who have been most hit by the biggest inflation in 40 years. “Everyone wants to get to work.
“They want to get to the doctor’s office,” Thompson explained, explaining why the $100 per month would be beneficial. None of the disagreements appear to be fatal, however, as Rep. Lou Correa, D-Anaheim, put it, “gas is the number one concern for my constituents right now.” As a result, “we all agree we have to do something,” DeFazio added. This storey was first published on March 28, 2022, at 5:00 a.m.