Rep. Grijalva calls on Justice to deny $5.35 billion tax break for BP after Deepwater Horizon

Rep. Grijalva calls on Justice to deny $5.35 billion tax break for BP after Deepwater Horizon

WASHINGTON, D.C. — A letter signed by 53 members of the House was sent this morning to Attorney General Loretta Lynch. Led by Natural Resources Committee Ranking Member Raul Grijalva (D-Ariz.), it called on the Justice Department to protect taxpayers from the ongoing tragedy of British Petroleum’s 2010 Deepwater Horizon oil spill.

At issue is a proposed out-of-court settlement between BP, the Justice Department and the five states of the Gulf Coast. Unless strict language is included in the final agreement, most of the $20.8 billion cost is likely to be tax deductible, resulting in a potential tax windfall for BP worth $5.35 billion. The letter calls on the Justice Department to avert this by specifying in the final settlement that no part of BP’s costs may be tax deductible.

Consumer and environmental groups expressed their support for the letter:

“It is simply unconscionable for taxpayers to be forced to subsidize the costs of BP’s disaster,” said Lukas Ross, climate and energy campaigner at Friends of the Earth. “We thank Rep. Grijalva for protecting our tax dollars and our environment.”

“Subsidizing BP’s disaster is wrong for the environment and wrong for taxpayers,” said Allison Fisher, Outreach Director for the energy program at Public Citizen. “We applaud Rep. Grijalva’s stand against BP deducting the cost of its ‘gross negligence.’”

“Dumping 210 million gallons of oil into the Gulf of Mexico and permanently damaging the ecosystem — not to mention the unparalleled damage done to our climate — should not come with a tax break from the American public,” said Athan Manuel, Director of the Lands Protection Program for Sierra Club. “We applaud Rep. Grijalva for standing up for our climate, our environment, and the American taxpayers.”

“We thank Rep. Grijalva and the other members of Congress working to ensure our tax dollars do not subsidize the company responsible for the largest environmental disaster in U.S. history,” said Greenpeace Oceans Campaign Director John Hocevar. “The people and wildlife of the Gulf are still recovering from BP’s negligence. The Justice Department must enforce this settlement without granting the company a substantial tax break.”

“By allowing BP to claim such a significant portion of this settlement as a cost of doing business tax deduction, the Department of Justice is sending the wrong message and forcing taxpayers—many of whom have already borne the burden of the damage the oil spill wrought—to pick up the tab yet again,” said Michelle Surka, program associate with U.S. Public Interest Research Group. “Rep. Grijalva and his fellow Congressmembers are right to join the thousands of Americans calling for a better deal that denies these deductions.”

“If the Obama administration is serious about combating both climate change and corporate corruption, it must not give away billions of American tax-payer dollars to BP for the worst environmental disaster in U.S. history.  There is no gray area here: it would be a complete abomination of justice if this settlement was to give tax breaks to a multinational oil conglomerate that ruined the lives of so many,” said Bill Snape, senior counsel at the Center for Biological Diversity and a law professor at American University.

“It defies common sense that BP could write-off costs paid for harming Gulf Coast families, wildlife and the economy, but that’s what happens when the fossil fuel industry is allowed to rig the rules,” said Janet Redman, climate program director at the Institute for Policy Studies. “We need more leaders like Rep. Grijalva who stand up for the public interest.”


Lukas Ross, Friends of the Earth, (202) 222-0724, [email protected]
Michelle Surka, US PIRG, (617) 747-4386, [email protected]
Bill Snape, Center for Biological Diversity, (202) 536-9351, [email protected]
Jonathon Berman, Sierra Club, (202) 495-3033, [email protected]
Perry Wheeler, Greenpeace USA, (301) 675-8766, [email protected]
Allison Fisher, Public Citizen, (202) 454-5176, [email protected]
Janet Redman, Institute for Policy Studies—Climate Program, (202) 787-5215, [email protected]

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