Senate Finance Committee Chairman Max Baucus Max Sieben BaucusBottom line Bottom line The Hill's Morning Report - Presented by Facebook - George Floyd's death sparks protests, National Guard activation MORE (D-Mont.) unveiled plans to pare back oil industry tax breaks Thursday as part of a wider proposed overhaul of the corporate tax code.



The plan does not attack as many industry tax breaks as some liberal Democrats and the White House have proposed. But it nonetheless drew a quick criticism from the oil industry.



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The plan would end the immediate write-off of drilling costs, an incentive that’s fully available to independent oil producers and partially available to the majors like Exxon and BP.A separate provision in the Baucus plan places new limits on percentage depletion, a deduction on income oil-and-gas production available to independent producers.The Independent Petroleum Association of America slammed the proposal, claiming that it “jeopardizes America’s energy renaissance.”“Current tax rules and laws ensure that industry pays its fair share in taxes, which is now one of the most heavily taxed industries in the country. The current tax code also encourages investment resulting in massive new U.S. energy supplies and millions of jobs,” said Barry Russell, the group’s president and CEO.But the plan does not target some other incentives, including the oil-and-gas industry’s ability to claim a lucrative deduction on domestic manufacturing income, called the Section 199 deduction.Removing that incentive has been a staple of many other Democratic plans to remove oil industry tax breaks and White House budget proposals.However, the Baucus plan would end the ability of businesses – including oil companies – to use the “last in, first out” (LIFO) accounting method, which drew criticism from the American Petroleum Institute (API).“Changes to cost recovery and repeal of legitimate accounting methods like LIFO could unintentionally hit the brakes on America’s energy and manufacturing renaissance,” API spokesman Brian Straessle said.The Hill’s On The Money blog has more on the Baucus plan here