On K Street, tax extender skepticism

K Street isn’t convinced that Congress can extend a slew of expired tax breaks before the November elections, even though the Senate’s top tax writer has said he wants to move “quickly” on the incentives.

{mosads}Senate Finance Committee Chairman Ron Wyden (D-Ore.) has said recently that the so-called “tax extenders” could serve as a bridge to the more comprehensive tax reform that’s a top priority for him and other top lawmakers.

But lobbyists and other tax observers they say there’s no guarantee Wyden would succeed with extending the more than 50 tax breaks soon, even with the support of his own leadership.

For starters, following the recent suspension of the debt limit, and with election year efforts ramping up, the House and the Senate aren’t expected to come together on many more legislative initiatives over the next nine months.

The expired tax provisions, known as the tax extenders, are frequently extended retroactively but are often tacked onto a broader legislative measure. If there is no big measure, it’s unclear how they’d move before the lame-duck session after voters head to the polls in November.

At the same time, House Ways and Means Committee Chairman Dave Camp (R-Mich.) has not backed away from his vow to deal with extenders as part of his efforts on tax reform, and still hopes to release a broad overhaul plan in the coming weeks.

“Camp had certainly made it clear extenders weren’t moving before reform,” one tax lobbyist said.

Sen. Orrin Hatch (Utah), the top Republican on the Finance Committee, is open to working with Wyden on extenders and a range of other issues, according to a spokeswoman.

Hatch had objected to a Democratic attempt to push through all of the expired provisions in December, complaining Senate Majority Leader Harry Reid (D-Nev.) was going around the Finance Committee.

But even if Wyden and Hatch do want to team up on extenders, there are still obstacles for moving quickly.

While Democrats pushed to extend all the lapsed incentives late last year, Hatch and then-Senate Finance Committee Chairman Max Baucus (D-Mont.) pushed a bill through the committee that tossed aside some expired preferences in August 2012.

That measure still didn’t become law until it was tacked on to the broader “fiscal-cliff” deal that was signed early in 2013.

And even though it scrapped some provisions, it wasn’t aggressive enough for some Republicans. There’s also a question of whether some lawmakers would push to offset the billions of dollars any extender package would likely cost this time around.

With dozens of tax breaks now expired for more than a month, lawmakers are already introducing bills to extend their favored preferences. Sens. Maria Cantwell (D-Wash.) and Chuck Grassley (R-Iowa), both Finance Committee members, released a measure last week to extend a credit for biodiesel producers.

Still, Wyden’s urgency on extenders drew cheers on K Street, where the expired provisions have some important backers.

“There’s always a huge constituency for the extenders,” a lobbyist said.

Wyden himself is a strong supporter of expired incentives for alternative energy, and top Democrats have tax breaks of their own that they’re eager to extend. Sen. Charles Schumer (D-N.Y.), for instance, has lobbied hard for a preference for workers who use mass transit.

“I am not going to sacrifice important matters like research and development and innovation on the altar of perhaps some inaction on comprehensive reform,” Wyden said in an interview with Bloomberg Television that aired on Friday.

Some lobbyists hope that — even if it’s still a good shot for extenders to be on the lame-duck agenda — action by Wyden and the Senate would “force the House to act,” as one lobbyist put it.

Other lobbyists suggest that just Camp’s release of a broader tax reform bill could also spark some action on extenders, because of the long odds facing an overhaul this year.

Tags Chuck Grassley Maria Cantwell Orrin Hatch Ron Wyden Tax extenders Tax reform

Copyright 2024 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed..

 

Main Area Top ↴

Testing Homepage Widget

 

Main Area Middle ↴
Main Area Bottom ↴

Most Popular

Load more

Video

See all Video