Letter to Senator Phil Gramm of Texas Concerning the Omnibus Trade and Competitiveness Act of 1988

 

August 23, 1988

 

Dear Phil:

 

I have just approved H.R. 4848, the Omnibus Trade and Competitiveness Act of 1988. In addition to strengthening the ability of the United States to compete in world trade, the bill repeals the ``Windfall Profits'' penalty tax on America's energy industry -- a goal we have long sought.

 

Repeal of the Windfall Profits tax reflects a recognition that free market incentives -- not taxes and government regulation -- will keep America's oil and gas industries among the world's leading energy producers. The tax imposed substantial costs and paperwork on energy producers while raising little revenue for the Federal Treasury. It made no sense for Congress to force energy producers to spend many millions of dollars each year in accounting and administrative costs just to report that no tax was due.

 

The people of Texas and the Nation will benefit from the stronger and more competitive energy industry brought by the elimination of this counterproductive tax. With appreciation for your crucial leadership and hard work on the repeal of the Windfall Profits Tax, I am pleased to enclose the pen with which I signed H.R. 4848 into law.

 

Sincerely,

 

Ronald Reagan

 

Note: An original was not available for verification of the contents of the letter.