Rachel Slajda July 28, 2010, 9:25 AM

BP told investors yesterday that it plans to deduct oil spill costs from its U.S. tax bill, cutting its taxes by $9.9 billion.

As WaPo reports, BP estimated in its second-quarter earnings report that it will spend $32.2 billion on costs related to the oil spill.

Companies are allowed to deduct up to 35 percent of losses from their taxes.

BP also announced in the report that it is slimming down operations, planning to sell off $25 billion to $30 billion of its assets over the next year and a half.

One oil analyst pointed out to the paper that, even with the 10 percent sell-off, BP will still be the second-largest international oil producer in the world.

BP, Gulf Coast Oil Spill