Biden plans to gut tax incentives for America’s energy industry

President Biden‘s $5.8 trillion budget is proposing to end all federal tax incentives for America’s domestic fossil fuel industry.

Mr. Biden said the move is needed not only to combat climate change and bring the U.S. in line with the Paris Climate Accords but to also reach the administration’s goal of cutting the deficit by more than $1 trillion this year.

“Budgets are statements of values, and the budget I am releasing today sends a clear message that we value fiscal responsibility, safety and security at home and around the world, and the investments needed to continue our equitable growth and build a better America,” said Mr. Biden.

Administration officials are aiming at various incentives and benefits within the federal tax code that benefit the fossil fuel industry. Everything is on the chopping block, from how miners can write off exploration and development costs to tax credits for oil and natural gas produced from aging wells.

The White House said that by slashing such incentives they will save taxpayers more than $43 billion over the next decade.

“The window to avert the worst climate outcomes is closing and we need to address this crisis now,” said Senate Finance Committee Chairman Ron Wyden, Oregon Democrat. “Energy policy is tax policy, and the federal tax code is woefully inadequate to address today’s energy challenges.”

GOP lawmakers called it an antagonistic approach to American energy production. They said Mr. Biden has no concrete plan to lower energy costs that continue to climb.

“President Biden wants more gas for Europe from U.S. companies he wants to put out of business,” said Rep. Chris Stewart, Utah Republican. “If he’s serious about solving the West’s energy problems, he’ll reverse his anti-American energy policies.”

As with the entire budget plan, Mr. Biden’s push to scrap tax incentives for the fossil fuel industry faces long odds in Congress. Both Republicans and moderate Democrats such as Sen. Joe Manchin III of coal-heavy West Virginia are expected to block the move.