Washington, D.C. - Senate Finance Chairman Max Baucus (D-Mont.) and Finance Ranking Member Chuck Grassley (R-Iowa) today unveiled a modified package of energy tax legislation for consideration by Congress this year. The $21.8 billion legislation, similar to a package passed by the House last week, still advances the development of advanced electricity infrastructure, contains incentives to mitigate carbon emissions, promotes the production of alternative energy and the security of our domestic fuel supply, supports the use of alternative vehicles, and encourages energy savings and efficiency. The Senators said today that the modest changes they’ve made should allow the legislation to move forward to passage by the full Senate as part of the larger energy bill.
“If America’s really going to make a change in terms of energy policy, encouraging new energy strategies in the tax code must be part and parcel of that effort. The energy tax package we’re unveiling today in the Senate is just as strong and just as needed as the legislation passed by the House," Baucus said. “This tax package can help to chart a bold course toward energy independence for America, and will also eliminate outdated incentives from the past. Encouraging the development of renewable fuels, rewarding energy conservation, and requiring responsibility from today’s energy producers are the right roles for tax policy to play in this country’s energy future."
“This energy tax package builds on the tremendous legislative gains we’ve made in recent years to encourage renewable energy, develop domestic energy supplies and encourage greater conservation and energy efficiency. These tax policy initiatives help to buffer our economic and national security interests, protect the environment, and create jobs in the United States. An important component of the Senate version of this legislation is that it restores the wind-energy tax credit to current law and rolls back the misdirected limitation on the credit that was in the House bill," Grassley said.
Modifications to the package were also made in close consultation with Senate Energy Committee Chairman Jeff Bingaman, who is also a member of the Finance panel.
Changes from the Clean Renewable Energy and Conservation Tax Act of 2007 unveiled last week by Baucus and House Ways and Means Chairman Charles Rangel (D-N.Y.) include:
• Extension of renewable energy production tax credit for two years without changing current law structure of credit.
• Creation of a new category of tax exempt bonds for electric transmission facilities.
• Change of effective date of provision regarding biodiesel that is imported and sold for export changed to date of enactment, rather than retroactive.
• Extension for two years of current refinery expensing provision, per energy tax legislation approved by Senate Finance Committee in June.
• Creation of twenty percent consumer tax credit for conversion of hybrid vehicles to plug-in hybrids.
• Repeal of Section 199 tax deduction for domestic oil and gas production now applies only to major integrated oil producers, rather than to all domestic oil and gas producers. This reduces revenue raised by the provision to $9.4 billion, from the $9.99 billion raised by the original proposal.
• Elimination of proposal repealing favorable depreciation for natural gas distribution lines.
• Addition of provision repealing suspension of certain tax penalties and interest.
• Addition of option to treat elective deferrals as after-tax contributions.
• Removal of Davis-Bacon requirements in tax credit bond provision.
Changes to existing elements of the bill caused adjustments to cost scores for some provisions.
New dollar figures are included in the summary found in the printer-friendly version of this release.
As noted, the package still includes revenue-raising provisions affecting the oil and gas industry,
repealing the domestic manufacturing incentive for the top five integrated producers and also tightening rules governing the payment of taxes by oil and gas producers on foreign-earned income. However, the provisions have been designed to prevent any retroactive effect on the industry and to avoid negative impacts on production that may generate increased consumer prices. For updated information on how these provisions will not negatively affect consumer prices, please visit the Joint Economic Committee website at: http://www.jec.senate.gov/
A full summary of the Clean Renewable Energy and Conservation Tax Act of 2007 can be found in the printer-friendly version of this release.
Source: Ranking Member’s News
