White House Announced Tax Increase for Oil Companies

President Obama is giving his support to legislation that would raise taxes on oil companies and increase the liability they face in the event of an oil spill. The White House asked Congress Wednesday to raise limits on BP's liability for the Gulf oil spill, approve new spending on everything from food stamps to seafood inspections and increase taxes on oil companies for an emergency cleanup fund.

The legislation would increase the 8-cent per barrel tax on oil companies to 9 cents immediately. "While we are asking for additional funds, in some cases, the federal government will not relent in pursuing full compensation for the expenses it has occurred and damage caused by the spill," White House energy adviser Carol Browner said in a conference.

Administration officials said they couldn't forecast total costs from the cleanup of the massive spill and a multitude of economic damages to the Gulf region, but the changes they're seeking in the legislative package unveiled Wednesday suggest a multibillion dollar response.

The administration wants to increase from $1 billion to $1.5 billion the amount that could be spent from an emergency cleanup fund paid with industry fees, and raise a $75 million liability limit BP would bear for costs not directly connected to cleaning up the spill, such as lost wages and tourism.