In a sign of business-as-usual on Capitol Hill, the Senate Finance
Committee backed tax breaks for auto race tracks, wind energy,
multinational corporations, Hollywood, school teachers, Puerto Rican
rum producers, college tuition and more.
About 50 temporary tax breaks won a two-year extension from the
panel in an $85 billion legislative package known as the
"extenders," so named because they need to be renewed regularly.
They will next go to the full Senate for consideration.
The tax-writing House of Representatives Ways and Means Committee is
set to vote on its own extenders package next week.
Most of the extenders technically expired at the end of 2013. The
measure just approved would renew them retroactively, costing the
federal government billions of dollars in lost revenues, to the
dismay of fiscal hawks.
"What this country should be doing is overhauling the disaster of a
tax code," said Maya MacGuineas, president of the Committee for a
Responsible Federal Budget, in a statement.
"Instead we are seeing Washington at its very worst as special
interests and members of Congress run to protect their favorite tax
breaks," said MacGuineas, whose group advocates for reducing the
federal deficit and debt.
On Tuesday, Senate Finance Chairman Ron Wyden, a Democrat, and top
committee Republican Orrin Hatch had unveiled a slimmed-down
"extenders" package. At the time, Wyden said he was "determined this
will be the last extenders bill on my watch."
At the committee meeting, Wyden reiterated that he wants to end the
extenders process as part of a broad overhaul of the tax code. But
he acknowledged that that will not happen soon.
"Today, we've got to balance short-term needs with long-term goals,"
said Wyden, who just recently took over the committee.
[to top of second column]
The approved package includes a tax break used by big companies to
avoid corporate income tax on capital transfers between offshore
units, known as the look-through rule. Wyden had excluded this in
his original bill, but it was put back.
Tax breaks for wind energy production and auto racing tracks were
also added back to Wyden's legislation. Other tax breaks were
renewed included ones for teacher supply costs, mortgage insurance
costs, railroad track maintenance, bonus depreciation for
businesses, and business research and development.
The committee approved two amendments to help small businesses.
Senators voted to allow small businesses to get the research and
development tax credit when they are incurring losses. Additionally,
the committee approved inflation protection for certain small
business tax breaks.
(Reporting by Patrick Temple-West and Kevin Drawbaugh;
[© 2014 Thomson Reuters. All rights
Copyright 2014 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.