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Massive tax break package unveiled just before midnight  

Also missing from the tax legislation were extensions of credits for solar and wind energy that Democrats had sought, as well as a delay in Obamacare’s looming “Cadillac” tax on expensive health care plans, a policy opposed by unions.

It’s possible those measures could be tucked into a bill extending government funding for the rest of the fiscal year, which also appeared shortly after midnight and is expected to be considered alongside the tax bill. The spending bill is are more likely to pass with Democratic votes. The extenders bill, on the other hand, is likely to receive opposition from Democrats concerned about its cost and is more likely to be passed by Republicans.

Credit:  By Joseph Lawler | Washington Examiner | 12/16/15 | www.washingtonexaminer.com ~~

Congressional negotiators unveiled a massive legislative of tax breaks just before midnight Tuesday, part of talks over year-end spending legislation that could end a decades-long routine of extending temporary tax breaks and reshape the tax code

The proposed “extenders” legislation, hammered out between congressional negotiators in both parties, would make permanent many business tax breaks prized by Republicans that had previously been extended on a temporary basis. It would also make permanent low-income tax credits favored by the White House and Democrats.

The bill also includes a two-year delay of the medical device tax included in the Obamacare legislation, one of the sources of revenue used to pay for the expansion of health insurance coverage of the bill.

No estimate for the budgetary cost of the legislation was immediately available. Based on outside estimates of a similar package of tax breaks, however, the cost to the Treasury over 10 years could be around $800 billion on paper.

Congressional Republicans touted the legislation as a step away from uncertainty in the tax code and toward comprehensive tax reform, a top priority for the GOP.

“By providing permanency and certainty in the tax code, this bipartisan bill sets the stage for a comprehensive tax overhaul that will provide bigger paychecks, better jobs, and more opportunity for the American people,” said Orrin Hatch, chairman of the Senate Finance Committee, in a statement sent out after midnight.

His Democratic counterpart, Ron Wyden of Oregon, drew attention to the low-income tax credits included in the legislation. “Millions of working families with children will not find themselves suddenly taxed into poverty,” he said. “Millions of college students won’t have the rug pulled out from under them when the tuition bill arrives.”

The low-income tax credit provisions backed by Democrats included expansions to the Earned Income Tax Credit and the Child Tax Credit made as part of the 2009 stimulus bill and subsequently re-upped through 2017. Those expansions, along with a college costs tax credit, will now be permanent, a victory for Democrats and the White House.

The bill does not include, however, a provision tying the amount of the Child Tax Credit – $1,000 per child – to inflation. Such a measure, which would have prevent the size of the refundable credit from diminishing each year as prices rise, was sought by congressional Democrats, including House minority leader Nancy Pelosi. The legislation also contains new policies to prevent the refundable credits from being paid out retroactively improperly.

Also missing from the tax legislation were extensions of credits for solar and wind energy that Democrats had sought, as well as a delay in Obamacare’s looming “Cadillac” tax on expensive health care plans, a policy opposed by unions.

It’s possible those measures could be tucked into a bill extending government funding for the rest of the fiscal year, which also appeared shortly after midnight and is expected to be considered alongside the tax bill. The spending bill is are more likely to pass with Democratic votes. The extenders bill, on the other hand, is likely to receive opposition from Democrats concerned about its cost and is more likely to be passed by Republicans.

Among the provisions favorable to Republicans are the permanent extensions of several business-related extenders long-sought by the GOP, such as a credit for research expenditures and a provision allowing small businesses to write off spending on property and machinery. The package also extends “bonus depreciation” through 2019, with a phase-out. That provision, which allows businesses to more quickly write off the costs of investments, is generally opposed by Democrats, who have argued that it was a costly stimulus measure that should now expire.

The text of the tax bill and a summary of its provision were available on the House Rules Committee site just minutes before midnight, meaning that it could be voted on as soon as Thursday and still meet a three-day rule for considering legislation in the House.

Source:  By Joseph Lawler | Washington Examiner | 12/16/15 | www.washingtonexaminer.com

This article is the work of the source indicated. Any opinions expressed in it are not necessarily those of National Wind Watch.

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