Ship of Fools
Volume XIX No. 13: March 28, 2014
It’s not even April Fool’s day yet and Congress is already pulling a fast one on taxpayers. A fast two, in fact.
First, Congress is intent on taking up the tax extenders package, a bill filled with tax break zombies that seem to live past their annual or biennial expiration – it seems for perpetuity. Ranging from boons for NASCAR track owners, to credit for giving away spoiled food, to helping line the pockets of major rum producers – many of these provisions are questionable. This hodge-podge of breaks and carveouts often hitches on as a caboose to whatever legislation seems to be moving through the Capitol. At least in this Congress, there seems to be precious few legislative trains leaving the station, so they are moving forward in the open.
Senator Ron Wyden (D-OR) said the tax extenders were a priority of his soon after ascending to the Finance Committee Chairmanship last month. That’s not that surprising since he has been a vocal advocate for one provision in particular that would benefit manufacturers in his state. He was even successful in getting a modified version of the provision – the tax credit for electric motorcycles– reinstated in the package last Congress after it was deleted by his predecessor, Sen. Max Baucus (D-MT).
To his credit, the ranking Republican on the Senate Finance Committee Sen. Orrin Hatch (R-UT) has said that he believes there is a lot of fat to cut in the package and that each provision should be scrutinized. And it appears that Chairman Wyden will hold votes on controversial items. So we expect to see some procedural improvements this time around. All that said, this whole exercise runs counter to the notion of comprehensive tax reform and the “blank slate” approach of eliminating all the breaks and only letting the most worthy back into the code.