Document:California Press Release 5 July 2001 Libertarians Back Bills to Curb Greediest Energy Gouger

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14547 Titus Street, Suite 214
Panorama City, CA 91402
For immediate release: July 5, 2001
For additional information:
Juan Ros, Executive Director
Phone: (818) 782-8400

California Libertarians back bills to curb the greediest energy gouger: government

LOS ANGELES -- Looking to curb "government energy gougers," the Libertarian Party of California has endorsed two energy tax relief bills proposed in the state legislature.

Assembly Bill X2 72 would repeal the state's 15 cent-per-gallon sales tax on gasoline. Senate Bill X2 69 would stop local governments from inflating their revenue with utility taxes based on fluctuating power prices.

"While California politicians use high energy prices as a reason to scrutinize the business practices of power generators and oil companies, they're reaping tax bonanzas based on those same high prices," said Juan Ros, executive director of the Libertarian Party of California.

"When Duke Energy or Chevron legally maximize their profits as a result of tight energy markets, politicians start looking for criminal conspiracy. But the state, and various local governments are engaged in the same sort of profiteering, using spikes in fuel and electricity prices to command enormous tax increases. They point the finger at industry with one hand, and rake in the cash with the other."

The proposed gasoline tax rollback, ABX2 72 by Tony Strickland (R-Moorpark), would eliminate a punitive "double tax." California's gasoline sales tax is based on the per-gallon price, which includes both federal and state excise taxes totaling about 36.5 cents per gallon.

"The sales tax is, in part, a tax on a tax, pulling an additional $4.5 million per day from the wallets of California drivers," Ros said.

SBX2 69 by Senator Tom McClintock (R-Thousand Oaks) requires local governments to base utility taxes on units of usage, rather than on retail prices. According to Ros, calculating user taxes based on price provides local politicians with a mechanism that pushes taxes higher as energy prices rise, even though actual usage may have remained the same, or decreased.

"Cities that employ this formula have enjoyed the same pattern of soaring revenues that generated investigations and threats of criminal prosecution against energy producers. All the while, their citizens scrimp and conserve, only to be rewarded with higher taxes," Ros added.

"The Libertarian Party of California urges taxpayers to order a halt to these government windfall schemes by insisting that their representatives vote for ABX2 72 and SBX2 69," Ros concluded.