Oil companies will have to pay a tax to fund oil spill cleanups after Congress signed a new budget.
At one point the tax was eliminated, but the nine cents per barrel tax on domestic crude oil and imported crude and petroleum products ended up reinstated as part of an “extenders” tax bill package.
The package was a part of the Senate’s budget deal and would put the oil tax back into effect starting March 1.
The tax on companies selling oil within the U.S. generated an average annual revenue of $500 million, according to the Congressional Research Service. But Republican leaders decided against renewing the tax in December, causing it to lapse at the end of the year.
The lapse was met with heavy criticism from the public and environmentalists.
“The Oil Spill Liability Trust Fund ensures that when there is a spill, American taxpayers are not left holding the bag to clean up Big Oil’s mess,” Sen. Ed Markey (D-Mass.) said at the time. “We should have a robust trust fund — not just trust that oil companies will do nothing wrong — in case a disaster like the BP spill happens again.”
The oil tax is the primary contributor to the Oil Spill Liability Trust Fund, which is used to pay for oil spill cleanups similar to the BP Deepwater Horizon oil spill.
The fund contained $5.8 billion at the time of the lapse.