The contentious tax deal between President Obama and House Majority Leader Mitch McConnell (R-KY) got a little more interesting last week. On Thursday evening, Senate Majority Leader Harry Reid (D-NV) revealed a bill that adds green energy tax provisions to the deal. As Alexander Bolton writes in The Hill,
“To win over wavering liberals, Reid has added an ethanol tax credit, which Sen. Tom Harkin (D-IA) supports, and an extension of the Section 1603 cash grant program for the renewable energy industry, which Sen. Sherrod Brown (D-OH) favors.”
The White House has welcomed the news, as has Senator John McCain (R-AZ), who despite having “serious concerns” about the package, plans on supporting it. Lon Huber and Alex Christensen wrote recently on the importance of extending the Section 1603 grant program, and renewable energy trade groups have strongly supported the measure. Bolton goes on to note,
“The package includes other green-energy incentives that could win support among House liberals, who are disappointed the Senate failed to take up a comprehensive energy reform and climate bill this year. They include tax credits for biodiesel and renewable diesel; energy-efficient homes; alternative fuels; and a 30-percent investment tax credit for alternative vehicle refueling properties.”
The legislation extends Bush-era tax cuts for another two years, federal unemployment benefits for another 13 months, keeps in place the current version of the estate tax, and provides additional tax benefits for mass transit use, elementary and secondary school teachers, and property owners with land used for conservation. Today at three the Senate is scheduled to hold a cloture vote, which will begin a showdown with House Democrats. While it increasingly looks like the legislation will pass, House Democrat Chris Van Hollen of Maryland has made it clear that his caucus views the current bill as “unacceptable”.