US Congressman Proposes New Taxes On Oil Companies Months After Buying Tesla Shares: What Investors Should Know

The push for members of the U.S. Congress to not be allowed to buy and sell stocks continues. A recently disclosed transaction by a member of Congress shows there continues to be conflicts of interest in pushing for policies that could benefit investment holdings.

What Happened: Sen. Sheldon Whitehouse, a Democrat representing the state of Rhode Island, purchased shares of Tesla Inc TSLA on Jan. 28, 2022.

The purchase was for shares valued in a range of $15,001 to $50,000.

The move follows other members of Congress including Speaker of the House Nancy Pelosi and Rep. Dan Crenshaw (R-Texas) who have taken positions in the electric vehicle leader.

Pelosi purchased calls prior to the unveiling of new clean energy initiatives and electric vehicle credits. Crenshaw bought shares of Tesla and then publicly supported a move of Tesla from California to Texas.

The moves also follow several members of Congress who purchased oil stocks and defense stocks prior to Russia invading Ukraine. 

Whitehouse is now advocating for something that could boost Tesla’s revenue and share price.

Related Link: 10 Best Stock Traders In Congress In 2021

Why It’s Important: Whitehouse recently introduced a plan to curb the profits made by “big oil companies” that are profiting off of increased gas prices.

“Big Oil Windfall Profits Tax would protect consumers from giant oil companies taking advantage of world events to jack up prices,” Whitehouse said in a post.

Under the bill, oil companies who produce or import at least 300,000 barrels of oil per day would pay a tax per barrel of 50% of the difference between the current price of oil barrels and the barrel price between 2015 and 2019.

Smaller companies would be exempt from the new tax.

Exxon Mobil Corp XOM and Chevron Corporation CVX are cited in the post by Whitehouse as companies gouging U.S. consumers.

Revenue from the oil profits would be paid out as quarterly rebates for people who earn less than $75,000 or $150,000 when filing jointly, with the possibility of receiving around $240 to $360 per year.

The bill was co-sponsored by a group of Senators including Elizabeth Warren (D-Mass.), Bernie Sanders (I-VT) and Cory Booker (D-N.J.).

“We’ve seen this script before, and we cannot allow the fossil fuel industry to once again collect a massive windfall by taking advantage of an international crisis,” Whitehouse said. “I propose sending Big Oil’s big windfall back to the hardworking people who paid for it at the gas pump.”

Whitehouse said the country should push to speed up a “transition to renewables” that could lower energy costs and protect from price spikes in oil.

The bill will be introduced to the House of Representatives.

Many U.S. consumers would likely welcome the higher taxes on oil companies and the rebate checks.

Whitehouse has pushed for alternative energy sources including solar power before, so the take against oil companies isn’t new.

This could be another example of a Congress member pushing through policies that could benefit their stock positions. The stock purchase of Tesla shares was not disclosed until March 16, which was after Whitehouse highlighted the bill.

TSLA Price Action: Tesla shares are up 0.50% to $844.45 on Thursday morning.

 

 

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Posted In: GovernmentNewsCommoditiesPoliticsOpinionMarketsGeneralBernie SandersCongressCongress tradesCongress tradingDan CrenshawElectric Vehicle StocksElizabeth WarrenEVsNancy PelosiOiloil and gasoil stocksRussiaSheldon WhitehouseUS Senate
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