I 
111TH CONGRESS 
1ST SESSION H. R. 3379 
To amend the Internal Revenue Code of 1986 to impose a tax on transactions 
in oil futures and options and to deposit the revenues from the tax 
into the Highway Trust Fund. 
IN THE HOUSE OF REPRESENTATIVES 
JULY 29, 2009 
Mr. DEFAZIO (for himself, Mr. OBERSTAR, Mr. GEORGE MILLER of Cali-
fornia, Ms. SLAUGHTER, Mr. RAHALL, Mr. BOSWELL, Mr. CAPUANO, Mr. 
LIPINSKI, Mr. CUMMINGS, Mr. DICKS, Mr. HINCHEY, Ms. HIRONO, Mr. 
THOMPSON of California, Mr. KILDEE, Mr. HARE, Mr. BAIRD, Ms. KAP-
TUR, Mr. MOLLOHAN, Mr. STARK, Mr. WU, Mr. COSTELLO, Mr. 
PASCRELL, Mr. FILNER, Mr. PERRIELLO, Mr. BISHOP of New York, Mrs. 
NAPOLITANO, Ms. NORTON, Mr. LARSON of Connecticut, and Mr. 
OLVER) introduced the following bill; which was referred to the Com-
mittee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to impose 
a tax on transactions in oil futures and options and 
to deposit the revenues from the tax into the Highway 
Trust Fund. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; FINDINGS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Lowering Oil Price Speculation for Infrastructure Dedi-
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cated to Economic Development Act of 2009’’ or the 
‘‘LOPSIDED Oil Prices Act of 2009’’. 
(b) FINDINGS.—Congress finds the following: 
(1) The price of oil has risen and fallen dra-
matically over the last decade without a clear con-
nection to the laws of supply and demand. 
(2) The price of a barrel of oil predictably 
stayed beneath $20 a barrel of oil for decades. In 
the beginning of 1999, the price was under $10 a 
barrel of oil, but since then the oil market has been 
plagued by speculation and fluctuated wildly. 
(3) In late 2004, the price of oil exceeded $40 
a barrel of oil, up 400 percent in 5 years. 
(4) In late 2007, the price exceeded $80 a bar-
rel of oil, up 800 percent in 8 years. 
(5) Nine months later, the price of oil peaked 
at $145 per barrel of oil, up 1450 percent in just 
under 10 years. While demand has risen, it has not 
to risen at those rates. 
(6) The price of oil collapsed in 2008, but the 
collapse preceded the greater economic downturn. In 
January 2009, the price had dropped to just over 
$30 a barrel of oil. 
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(7) The economy continues to slide downward 
pushing with it oil demand, but illogically the price 
of oil recently peaked at over $70 a barrel of oil. 
(8) Many economists have attributed this irra-
tional behavior of the oil market to the large in-
crease in speculative trading in oil derivatives. Crude 
oil is now the world’s most actively traded com-
modity futures contract. 
(9) In 2004, the New York Mercantile Ex-
change (NYMEX) facilitated 52 million oil futures 
contracts, and in 2008 NYMEX facilitated 134 mil-
lion oil futures contracts. Other exchanges have seen 
similar increases, and there is no accurate measure 
for over-the-counter trades. 
(10) On June 13, 2009, the finance ministers 
from G8 countries—Canada, France, Germany, 
Italy, Japan, Russia, Britain and the United 
States—said ‘‘Excess volatility of commodity prices 
poses risks to growth.’’ 
(11) Commodity Futures Trading Commis-
sioner Bart Chilton, said in June 2009, ‘‘Crude oil 
prices are up 60 percent on the year. Supplies are 
at a 10-year high, and demand is at a 10-year low. 
You do the math. Why should prices be over $70?’’ 
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(12) Many economists argue that a transaction 
tax on speculative trading will deter short-term spec-
ulation, which will reduce the volatility and price of 
oil. 
(13) James Tobin, a Nobel Prize winner in eco-
nomics, stated a security transaction tax ‘‘would 
automatically penalize short-horizon round trips, 
while negligibly affecting the incentives for . . . 
longer-term capital investments.’’ 
(14) Larry Summers, the current Chairman of 
the National Economic Council and the top economic 
adviser President Obama, wrote in 1989 that impos-
ing a securities transaction tax ‘‘would have the ben-
eficial effects of curbing instability introduced by 
speculation, reducing the diversion of resources into 
the financial sector of the economy, and lengthening 
the horizon of corporate managers. The efficiency 
benefits derived from curbing speculation are likely 
to exceed any costs or reduced liquidity or increased 
costs of capital that come from taxing financial 
transactions more heavily.’’ 
(15) A well-designed oil transaction tax could 
reduce the volatility of the oil futures market with-
out harming legitimate hedge traders. Oil prices will 
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then return to accurate price discovery following the 
supply and demand price curve. 
(16) Since 70 percent of oil consumed in the 
United States is for transportation, the revenue 
raised on oil transactions is an ideal additional 
source of funds for the Highway Trust Fund. 
SEC. 2. TAX ON TRANSACTIONS IN OIL FUTURES AND OP-
TIONS. 
(a) IN GENERAL.—Chapter 36 of the Internal Rev-
enue Code of 1986 is amended by inserting after sub-
chapter B the following new subchapter: 
‘‘Subchapter C—Tax on Transactions in Oil 
Futures and Options 
‘‘Sec. 4475. Tax on transactions in oil futures and options. 
‘‘SEC. 4475. TAX ON TRANSACTIONS IN OIL FUTURES AND 
OPTIONS. 
‘‘(a) IMPOSITION OF TAX.— 
‘‘(1) FUTURES.—There is hereby imposed a tax 
on each covered transaction in an oil futures con-
tract of 0.2 percent of the value of the futures in-
struments involved in such transaction. 
‘‘(2) OPTIONS.—There is hereby imposed a tax 
on each covered transaction in an oil option of 0.5 
percent of the premium paid on the option for a fu-
tures instruments involved in such transaction. 
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‘‘(b) BY WHOM PAID.— 
‘‘(1) IN GENERAL.—The tax imposed by this 
section shall be paid by— 
‘‘(A) the trading facility on which the 
transaction occurs, or 
‘‘(B) if such transaction does not occur on 
a trading facility, by the buyer of the trans-
action. 
‘‘(2) WITHHOLDING
IF
BUYER
NOT
UNITED 
STATES PERSON.—See section 1447 for withholding 
by seller if buyer is foreign person. 
‘‘(c) EXCEPTION FOR COMMERCIAL TRADERS.—The 
tax imposed by this section shall not apply to any trans-
action if— 
‘‘(1) either party to the transaction is— 
‘‘(A) classified by the Commodity Futures 
Trading Commission as a commercial trader 
with respect to oil, or 
‘‘(B) a financial institution acting on be-
half of such a party (but only if the financial 
institution does not at any time acquire owner-
ship of the security), and 
‘‘(2) the transaction is a bona fide hedging 
transactions (within the meaning of section 4a(c) of 
the Commodity Exchange Act). 
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‘‘SEC. 1447. WITHHOLDING OF TAX ON TRANSACTIONS IN 
OIL FUTURES AND OPTIONS. 
‘‘In the case of any acquisition of an oil futures con-
tract or an oil option (as such terms are defined in section 
4475) by a foreign person, the transferor shall be required 
to deduct and withhold a tax equal to the tax which would 
be imposed on such acquisition under section 4475 if the 
transferee were a United States person.’’. 
(c) TAX REVENUES DEPOSITED INTO HIGHWAY 
TRUST FUND.—Paragraph (1) of section 9503(b) of such 
Code is amended by striking ‘‘and’’ at the end of subpara-
graph (D), by striking the period at the end of subpara-
graph (E) and inserting ‘‘, and’’, and by inserting after 
subparagraph (E) the following new subparagraph: 
‘‘(F) sections 1447 and 4475 (relating to 
taxes on transactions in oil futures and op-
tions).’’. 
(d) CLERICAL AMENDMENTS.— 
(1) The table of subchapters for chapter 36 of 
such Code is amended by inserting after the item re-
lating to subchapter B the following new item: 
‘‘SUBCHAPTER C. TAX ON TRANSACTIONS IN OIL FUTURES AND OPTIONS.’’. 
(2) The table of sections for subchapter A of 
chapter 3 of such Code is amended by adding at the 
end the following new item: 
‘‘Sec. 1447. Withholding of tax on transactions in oil futures and options.’’. 
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(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to transactions occurring on or 
after October 1, 2009. 
Æ 
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