Senators are heading toward reviving almost all of the 55 tax breaks that expired Dec. 31, providing benefits for wind energy, U.S.-based multinational corporations and motor sports track owners.
Democrat Ron Wyden of Oregon, the chairman of the Senate Finance Committee, said today he supports reviving the $86.2 billion package of U.S. tax breaks though he wants to stop such temporary extensions. Instead, he said, Congress should revamp the entire tax code.
“This will be the last tax extenders bill the committee takes up as long as I am the chairman,” said Wyden, who took over the panel earlier this year after Max Baucus became U.S. ambassador to China.
Senators said they lament the need to routinely extend lapsed tax breaks. The research and development tax credit, which benefits companies such as Intel Corp. (INTC), has been expiring periodically since it became law in 1981.
Lawmakers have been unable to find a way out of the temporary revival pattern, reaching compromise by agreeing to extend almost all breaks that expired.
Members back provisions that are particularly important in their home states and trade support for other lawmakers’ favored breaks. These include a mass-transit commuting benefit that aids New York and New Jersey residents and the ability to deduct state sales taxes, which is important in states such as Washington and Florida that lack income taxes.
The proposal, which faces an uncertain future in the full Senate and the House, would extend the tax breaks through Dec. 31, 2015.
Before the committee began considering amendments, only a few items that expired Dec. 31 were excluded. Wyden offered an updated proposal today with some breaks he had left out when the plan was released earlier this week, including the production credit for wind that benefits companies such as Vestas Wind Systems A/S (VWS) and a break for film and television production.
The TV production break, which allows companies to immediately write off expenses, is being expanded to include stage productions. It is backed by Senator Charles Schumer of New York, home to Broadway’s live theaters.
One item that wasn’t included in either version is a tax credit for making energy-efficient appliances, a break that benefits General Electric (GE) Co. and Whirlpool Corp.
Wyden expanded a tax credit for hiring workers from disadvantaged groups to provide an incentive for hiring long-term unemployed workers.
To contact the editors responsible for this story: Jodi Schneider at firstname.lastname@example.org Mark McQuillan