Republicans Block Tax-Cut Bill, Leaving Breaks in LimboRichard Rubin
U.S. Senate Republicans blocked a package of more than $80 billion in tax cuts, killing for now a measure that would provide incentives for corporate research and wind energy.
Today’s vote on advancing the bill was 53-40, short of the 60 needed to move forward, as Republicans complained about being blocked from offering amendments.
The vote cast doubt on the future of dozens of tax breaks, many of which have bipartisan support and are caught up in a partisan feud. The bill’s author, Democratic Senator Ron Wyden of Oregon, said after the vote that he would try to talk with Republicans on potential changes and bring it back as soon as next week.
“No matter the excuse, Republicans continue to wage war on common sense,” said Senate Majority Leader Harry Reid, a Nevada Democrat.
The bill would revive more than 50 tax breaks that lapsed Dec. 31 and extend them through 2015. They include the research and development tax credit, the production tax credit for wind energy and a provision that lets companies such as Citigroup Inc. and Caterpillar Inc. defer U.S. taxes on overseas financing operations.
The measure emerged from the Finance Committee on a bipartisan voice vote last month. Even that agreement on the merits of the legislation wasn’t enough to overcome the procedural feud on the Senate floor.
One Republican, Mark Kirk of Illinois, voted with Democrats. Reid voted with Republicans to preserve his right to bring the bill up again. Seven senators were absent.
“I am going to do my very best in a bipartisan way with Senator Wyden to work out this impasse,” Utah Senator Orrin Hatch, the Finance Committee’s top Republican, said in a floor speech. Any agreement will have to allow both sides to offer amendments, he said.
“This is a bill that virtually everybody in this body wants, to a more or less degree,” Hatch said.
The bill would add about $84 billion to the U.S. budget deficit over the next decade. It includes narrower tax breaks such as accelerated depreciation for motor sports tracks, incentives for live theater productions and tax-preferred benefits for mass-transit commuters.
Groups such as the Business Roundtable support the measure. The Club for Growth, a Republican-aligned group that favors small government, opposes the bill as a giveaway to special interests.
The Senate has taken a different approach from the Republican-led House of Representatives, which is picking individual provisions and voting to make them permanent, starting with the research tax credit.
President Barack Obama’s administration hasn’t issued a statement on the Senate plan. The administration said Obama would veto the House research-credit bill because it would increase the deficit.
Though Republicans support many of the bill’s provisions, they objected to Democrats’ reluctance to let them offer and vote on amendments.
“It is a gag order, a gag order on the American people who we represent,” said Senate Minority Leader Mitch McConnell, a Kentucky Republican.
The bill is S. 2260. Democrats want to add it to H.R. 3474.