The Senate Finance Committee voted yesterday to exempt newly recovered "tertiary" oil from President Carter's proposed windfall profits tax, further weakening the measure's tax bite compared to the bill approved by the House.
The action, on a tentative 12-to-1 vote, would trim another $7.5 billion from the $104 billion in new revenues that the House-passed bill would bring in between 1980 and 1990. Tertiary oil is oil in existing wells that is difficult to pump.
Yesterday's move pushed the total the panel has trimmed from the House-passed windfall tax to $25.4 billion, leaving only $78,6 billion in expected new revenues if the remainder of the House bill were to stand.
In addition, the committee has approved tentatively another $99.2 billion in energy-related tax credits, which together with the reductions in revenues would "use up" $24.6 billion more than the House measure would bring in.
Finance Committee Chairman Russell B. Long (D-La.) stressed again yesterday that the disparity would have to be "reconciled," partly by cutting back some of the tax credits or delaying the dates they take effect.
Long predicted during the hearing that the windfall tax the committee ultimately approves will "raise substantial revenues." He also noted the oil companies will pay additional income tax as a result of 0il-price decontrol.
The exemption voted yesterday would apply only to "incremental" tertiary oil -- that is, oil in excess of the average monthly production levels in a specific property for the six months that ended last March 31.
To qualify for the exemption, a project would have to be certified, either by the Energy Deparment or a state regulatory body or by the producer, using federally monitored standards. The Internal Revenue Service could audit any self-certified project.