House Ways and Means Chairman Charles Rangel today said his panel could take up a one-year extension of numerous expiring tax provisions as early as next week, including renewable energy incentives that are a top Democratic priority. "We're putting some exciting things in the extender bill," Rangel said after a meeting with panel Democrats. The exact content of the bill was still being discussed, Rangel said. "The members have to make that decision as to the priorities, but we've got to have a very attractive package," he said. It will not include a fix preventing the alternative minimum tax from impacting 25 million taxpayers not already subject to it, which comes at a $60 billion-plus cost to extend for one year. That was a bridge too far for this go-round of tax cuts, as Rangel is seeking to comply with pay/go offset requirements. "The problem is paying for it," said Ways and Means Trade Subcommittee Chairman Sander Levin, D-Mich. An AMT fix could still move this year, and is included in a companion "extender" bill introduced last month by Senate Finance Chairman Max Baucus.
There are many expiring tax breaks affecting individuals and businesses, some of which expired at the end of last year, like the research and development credit, and others expiring this year, such as renewable energy credits for solar, wind and geothermal sources. The cost of extending them all for one year could top $50 billion, and Rangel indicated additional proposals have emerged. "We're working because we don't want to overload it," he said. "Actually, we have to bring [the price tag] back down." The main problem in extending the expiring provisions, as it was last year when the extenders failed to get enacted, is finding offsets that will be acceptable to enough Senate Republicans and President Bush. "To be honest with you, we have floating pay-fors," Rangel said. "Some that the Senate thinks are outrageous; some that we think should be involved in some controversy; and some that we think they will accept."
Last week, 41 Senate Republicans, enough to sustain a filibuster, wrote to Baucus that they would oppose offsetting extensions of existing tax policy. And some House Democrats have suggested including offsets in the House bill is unnecessary and will only subject their members to tough votes for no political reason, since they would never get through the Senate. Rangel said he sees these concerns, but believes that the House has a proper role to play in the debate and should not simply bow to the Senate's demands. "There are different degrees of feeling by our Caucus as to whether or not we should just ask what you want and just give up our jurisdiction," Rangel said, adding that he may want to discuss this question with House Speaker Pelosi. Meanwhile, a coalition of 114 labor, business and education organizations wrote to congressional leaders today urging them to act on the tax extenders.
This article appears in the May 10, 2008 edition of National Journal Daily PM Update.