Every year or two, Congress has to decide whether to continue more than 50 tax provisions that aren’t permanent law. The so-called tax extenders package is under consideration for the last weeks of the congressional session this year. One of the provisions most often in the headlines is the wind energy production tax credit. That’s critically important to the state of Iowa as a leader in wind energy production. It’s a provision that comes under fire from oil and gas industry interests that refuse to acknowledge the many permanent tax code benefits for fossil fuels even as they attack the wind energy incentive.
Each tax provision should get full consideration on its merits for renewal or removal. It’s unfair to single out wind energy for criticism while so many other industries quietly benefit from their own sections of the tax code. I’ll continue to fight for wind energy to get a fair shake at the tax table. The tax bill approved by the Finance Committee in April included my provision to extend the wind energy incentive for two years.
The House of Representatives might vote this week on a tax package that would retroactively reinstate various tax provisions for 2014 only. I would prefer a two-year extension to give some relief from uncertainty and build confidence in future business investments for job security and job creation.
Prior to the Thanksgiving break, House and Senate negotiators were making headway toward a bipartisan agreement that would have included permanent extensions of certain provisions, but the President threatened to veto that package. That put the discussion back to the drawing board.
Other provisions in the tax extenders package that get less ink than wind energy are also important to business owners, farmers, and individuals. For example, a provision involving enhanced expensing rules under section 179 of the tax code allows business owners and farmers to deduct up to $500,000 of the cost of new equipment immediately. For farmers, the deduction encourages equipment purchases that will enhance their farming operation. The purchases might occur through local dealers in small communities throughout the state, offering a boost to those dealers. They might also benefit in-state equipment manufacturer and major employer John Deere and help preserve jobs. Those kinds of investments have a positive effect on the local, state and national economies.
Most of the tax provisions before Congress expired at the end of 2013, and others will expire at the end of this year. The employers who make purchases and investments are in limbo as they wait for legislative resolution of the provisions of interest to them. Congress needs to act fairly and decisively on whether to renew expired tax provisions and for how long.