Bill Overview
Title: GOUGE Act
Description: This bill allows an exemption from the excise tax on gasoline, other than aviation gasoline, and the Leaking Underground Storage Tank Trust Fund financing rate, for the period beginning on the enactment of this bill, and ending on December 31, 2022 (gasoline tax holiday). It provides full reimbursement to states for any revenues lost due to the gasoline tax holiday. The bill also imposes an excise tax equal to 50% of the windfall profit of certain large oil and gas companies, beginning in 2022. The bill requires the Federal Trade Commission (FTC) to issue regulations prohibiting any sellers of crude oil, gasoline, or other petroleum distillate from engaging in price gouging. The FTC must investigate whether any oil company violated such prohibition during 2022, particularly during the period leading up to and after the Russian invasion of Ukraine on February 24, 2022, and impose specified civil penalties.
Sponsors: Rep. Norcross, Donald [D-NJ-1]
Target Audience
Population: Global consumers of gasoline, and employees of large oil and gas companies
Estimated Size: 300000000
- The bill impacts consumers of gasoline through the introduction of a gasoline tax holiday which might reduce prices at the pump.
- Large oil and gas companies with significant windfall profits will be affected by the imposition of a new excise tax.
- The bill aims to prevent price gouging, which could indirectly impact all consumers of oil and petroleum products by potentially stabilizing prices or preventing excessive price increases.
- The bill includes measures to combat price gouging by sellers of crude oil, which could affect their pricing strategies and revenue.
- Overall, the bill could influence the global oil market dynamics, indirectly impacting populations worldwide who rely on oil prices.
Reasoning
- Approximately 90% of U.S. households own at least one vehicle, meaning many Americans would experience some level of relief due to a temporary tax holiday on gasoline. The temporary nature of the holiday suggests immediate but not long-lasting effects for general consumers.
- Large oil and gas companies, particularly employees and shareholders, will feel the financial impact of the 50% windfall profit tax, which could have broader economic implications for investments and wages.
- The focus on price gouging by the FTC aims more at stabilizing prices, which could lead to indirectly reducing the consistent upward trend of oil prices for consumers.
- Overall, while the policy impacts are direct for certain large corporations, the general public (consumers of gasoline) might see more indirect benefits.
- Considering a budget of $5 billion per year, and with approximately 300 million Americans potentially impacted modestly by this policy, the direct financial impacts per individual are likely to be fairly limited.
Simulated Interviews
Teacher (Los Angeles, CA)
Age: 37 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 1.0 years
Commonness: 16/20
Statement of Opinion:
- The gas tax holiday is a welcome relief for my monthly expenses, even if it's temporary.
- I hope the new tax on windfall profits encourages oil companies to keep gas prices fair in the long run.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 6 | 5 |
| Year 3 | 6 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 5 | 5 |
Retired Engineer from Oil Industry (Houston, TX)
Age: 65 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 8/20
Statement of Opinion:
- The tax on windfall profits might impact my retirement income from investments in oil.
- The gas tax cut doesn't benefit me as much since I don't drive often.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 7 |
| Year 2 | 6 | 7 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 5 | 6 |
| Year 20 | 5 | 5 |
Freelance Graphic Designer (New York, NY)
Age: 29 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 0.0 years
Commonness: 12/20
Statement of Opinion:
- I don't drive much, so the gasoline tax holiday doesn't really affect me.
- I think the focus on price gouging is a good step forward to keep costs in check.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 5 | 5 |
| Year 3 | 5 | 5 |
| Year 5 | 5 | 5 |
| Year 10 | 5 | 5 |
| Year 20 | 5 | 5 |
Gas Station Owner (Jackson, MS)
Age: 55 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 1.0 years
Commonness: 5/20
Statement of Opinion:
- I worry that more regulations could increase costs or limit my station's pricing strategy.
- The temporary gas tax exemption might boost customer numbers at first.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 5 | 5 |
| Year 3 | 5 | 5 |
| Year 5 | 5 | 5 |
| Year 10 | 5 | 5 |
| Year 20 | 4 | 4 |
Software Engineer (Seattle, WA)
Age: 44 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 0.0 years
Commonness: 7/20
Statement of Opinion:
- I support measures to control price gouging, but the gasoline tax holiday impacts me very little.
- It's good to see steps towards more responsible profit taxation for big oil companies.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Delivery Driver (Chicago, IL)
Age: 32 | Gender: female
Wellbeing Before Policy: 4
Duration of Impact: 1.0 years
Commonness: 13/20
Statement of Opinion:
- Every penny saved on gas helps me put more money towards my living expenses or savings.
- Hope the crack down on price gouging means I don't see crazy spikes in costs again.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 4 |
| Year 2 | 5 | 4 |
| Year 3 | 5 | 4 |
| Year 5 | 5 | 4 |
| Year 10 | 5 | 4 |
| Year 20 | 4 | 3 |
Oil Company Executive (Tulsa, OK)
Age: 58 | Gender: male
Wellbeing Before Policy: 9
Duration of Impact: 10.0 years
Commonness: 4/20
Statement of Opinion:
- The windfall tax might reduce the bonuses and benefits we can offer employees.
- We'll have to adjust our financial strategies due to these new taxes.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 9 |
| Year 2 | 8 | 9 |
| Year 3 | 7 | 8 |
| Year 5 | 7 | 8 |
| Year 10 | 6 | 7 |
| Year 20 | 5 | 6 |
Grocery Store Manager (Miami, FL)
Age: 47 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 1.0 years
Commonness: 10/20
Statement of Opinion:
- Lower gas prices could reduce some of our logistics costs, which might benefit the business.
- Proactive FTC regulation against price increases is promising for keeping our costs stable.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 5 | 5 |
College Student (Denver, CO)
Age: 24 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 0.0 years
Commonness: 11/20
Statement of Opinion:
- Anything that could prevent sudden increases in living costs, even indirectly, is positive for me.
- The gas price changes don't directly affect my daily commute costs.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 5 | 5 |
| Year 3 | 5 | 5 |
| Year 5 | 5 | 5 |
| Year 10 | 5 | 5 |
| Year 20 | 5 | 5 |
Small Business Owner (Phoenix, AZ)
Age: 40 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 1.0 years
Commonness: 6/20
Statement of Opinion:
- The scramble in oil prices has affected shipping for my inventory, so stability would be reassuring.
- The tax holiday might slightly reduce costs temporarily, but it's not a major relief.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 6 | 6 |
| Year 20 | 5 | 5 |
Cost Estimates
Year 1: $5000000000 (Low: $4500000000, High: $5500000000)
Year 2: $0 (Low: $0, High: $0)
Year 3: $0 (Low: $0, High: $0)
Year 5: $0 (Low: $0, High: $0)
Year 10: $0 (Low: $0, High: $0)
Year 100: $0 (Low: $0, High: $0)
Key Considerations
- The final impact on federal revenue depends on the balance between foregone gasoline excise taxes and proceeds from the excise tax on oil company windfall profits.
- FTC enforcement efficacy will influence compliance with price gouging regulations and any subsequent impact on fuel prices.
- Implementation timing and accuracy of state reimbursements will affect both cost and savings estimates.