> The US government only takes a 12.5% royalty on profits from oil and gas extraction on public land [1].
This is horrific. Also the best argument I’ve seen.
The royalty rate is on production, not profits. The government takes 12.5% of all produced oil and has the right to the revenues. This is a much more burdensome tax than a tax on profits in that the government gets paid before the oil company, even if the oil company loses money on their investments. That’s why it’s not taxed at standard corporate tax rates.
Does the average oil company lose money on their investments?
While we would generate less tax revenue per capita than Norway would, that's not the point. The point is the state should take a much larger share of the profits of extracting natural resources that state owns.
[1]: https://www.americanprogress.org/article/federal-oil-and-gas...
[2]: https://www2.deloitte.com/content/dam/Deloitte/global/Docume...