For U.S. fuel manufacturers, repealing LIFO would amount to a retroactive tax hike because businesses would be forced to send the government cash based on federally mandated inventory re-evaluations. Refiners and petrochemical manufacturers are the first purchasers of crude oil and natural gas off the world market and are therefore particularly sensitive to crude oil price inflation and volatility.
And the new taxes could make the United States more reliant on foreign imports of refined product and, ultimately, cause an increase in gas prices across the country.
At a time when we are all looking for the business community to innovate and modernize to create new jobs and new opportunities for our citizens, these proposed tax reforms will have an opposite effect. They will increase the likelihood that American manufacturers will cut jobs and projects and push more production and opportunities overseas.
It’s time to stop looking for a one-size-fits-all solution for our business tax problems. Any single program will invariably choose winners and losers. Instead, we must find a way to push all business forward in a way that doesn’t devastate our traditional economic strengths in order to create the perception of a level playing field.
Charles T. Drevna is the president of the American Fuel and Petrochemical Manufacturers.
Vice President Joe Biden waits to conduct a mock swearing-in ceremony with Sen. Brian Schatz, D-Hawaii, in the Capitol's Old Senate Chamber, December 2, 2014. Schatz was sworn in to serve the remainder of his term since he was appointed to the seat after Sen. Daniel Inouye, D-Hawaii, passed away.