Democratic tax writers in the House of Representatives are resuming where they left off last year.
House Ways and Means Committee Chair Richard Neal (D-Mass.) recently announced the committee would move to markup the Growing Renewable Energy and Efficiency Now (GREEN) Act. Democrats originally unveiled a discussion draft
of the bill in November. It largely extends and enhances a number of alternative energy incentives through 2024. It also expands the plug-in electric drive motor vehicle credit so that a $7,000 credit is provided for 200,000 to 600,000 electric vehicles per manufacturer.
Democrats were unsuccessful in attaching the legislation to the massive tax package passed in December, but may have another chance this year. Republicans have previously signaled a willingness to negotiate on the proposal provided the revenue raisers were reasonable and the enhancements remained narrow.
The GREEN Act’s prospects could hinge on the likelihood of a broader tax deal materializing this year. Congress has a number of tax items on its 2020 agenda, including tax extenders and a handful of other technical corrections to the Tax Cuts and Jobs Act.
Republicans and Democrats are still at a standstill on a technical correction that would make Qualified Improvement Property (QIP) eligible for bonus depreciation, despite the fix enjoying bipartisan support. Senate Finance Chairman Chuck Grassley (R-Iowa) recently affirmed that QIP remains a top priority for Republicans. However, he was pessimistic that the two sides could reach a deal if Democrats continue to seek $100 billion in enhancements to tax incentives for families and low-income taxpayers, particularly after six weeks of negotiation at the end of last year failed to produce any progress.
The current political climate in Washington also adds to the uncertainty, with the impeachment trial and upcoming elections threatening to dampen the appetite for broad bipartisan compromise.
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