House Adopts $622 Billion Plan to Revive Expired Tax Breaks

December 17, 2015 12:55 PM
 
House Adopts $622 Billion Plan to Revive Expired Tax Breaks

The House adopted a $622 billion measure to revive dozens of business and individual tax breaks -- making some of them permanent -- ahead of a vote Friday on a companion plan to fund the U.S. government and lift the ban on crude oil exports.

The vote Thursday was 318-109. The House and Senate are planning to take final votes on the tax and spending bill Friday before leaving Washington for the holidays.

“Finally with this tax bill, families and businesses are going to get the long-term certainty that they need," House Speaker Paul Ryan, a Wisconsin Republican, told reporters during a news conference before the vote.

Congress has repeatedly extended the group of several dozen tax breaks for one or two years at a time. The measure passed Thursday would make a number of them permanent, including those for business research and development, small business expenses, individual deductions for state and local sales taxes, and financing rules for multinational corporations. Also to become permanent are an enhanced child tax credit and earned income tax credit, as well as tax breaks for charitable giving and schoolteachers’ expenses.

Making those provisions permanent "will deliver predictability, clarity and certainty for individual taxpayers as well as people managing businesses and trying to invest for the future," House Ways and Means Committee Chairman Kevin Brady, a Texas Republican, said before the vote.

The wind energy production tax credit would be extended for five years, a move sought by Democrats. The plan also would continue tax breaks for racehorse owners, motorsports facilities -- the so-called "NASCAR tax break" -- and some charitable contributions.

The tax measure would suspend the Affordable Care Act’s 2.3 percent tax on medical devices through 2017. The spending bill also would delay the so-called Cadillac tax on high-cost health insurance plans from 2018 to 2020.

The tax proposal is the first of a two-part deal reached by congressional Republican and Democratic leaders this week, along with the $1.1 trillion spending plan the House plans to vote on Friday. That measure includes an end to the 40-year-old ban on exporting crude oil from the U.S. The plans will be sent to the Senate together as H.R. 2029 for a vote Friday.

House Minority Leader Nancy Pelosi told fellow Democrats on Thursday that she’ll support the spending measure, said spokesman Drew Hammill.

Pelosi opposed the tax extension measure, though, denouncing it Wednesday as too heavily weighted toward companies and “practically an immorality.”

Michigan Democrat Sander Levin on Thursday called the plan a budget-busting measure that doesn’t pay for itself and leaves “more room to cut taxes for the very wealthy” in the future.

“For those whose purpose is to have the increase in the deficit continue to drive down non-defense spending, this bill will almost certainly accomplish this,” Levin said. “These cuts seriously threaten programs that assist the middle class or those striving to reach the middle class -- programs like Head Start and Pell Grants, and in job training and basic health research.”

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