Summary and Background
Senate Democrats are committed to enacting an energy policy that invests in renewable energy, lowers gas prices, makes America more energy independent, reverses global warming and strengthens our national security. In the 110th Congress, the extension and expansion of renewable and energy efficiency tax credits has been a critical component of that goal and Finance Committee Chairman Baucus and Ranking Member Grassley have worked tirelessly to meet that goal. Unfortunately, on multiple occasions, the vast majority of Bush Republicans in the Senate have protected the interests of oil companies and their record profits rather than American taxpayers.
The Renewable Energy and Job Creation Act of 2008 (H.R. 6049) will give Senate Republicans another opportunity to decide whether or not they support an energy policy that starts taking the initial steps necessary to move away from the failed Bush-Cheney energy policy. A major difference between H.R.6049 and previous legislation the Senate has considered on energy tax is the exclusion of offsets that would revoke unnecessary taxpayer subsidies for the big oil companies.
H.R.6049 also contains equally vital provisions that would put money back in the pockets of America’s hard-working middle-class taxpayers and promote job creation, enhance competitiveness, and support the U.S. economy by extending needed tax relief to individuals and businesses.
If enacted, H.R.6049 would:
- Create renewable energy incentives by providing almost $20 billion of tax incentives for investment in renewable energy related to energy production, transportation and domestic fuel security, and energy conservation and efficiency;
- Extend $27 billion of expiring temporary tax provisions for individuals and businesses, including the research and development credit, special rules for active financing income, the state and local sales tax deduction, the deduction for out-of-pocket expenses for teachers, and the deduction for qualified tuition expenses; and
- Provide additional tax relief for individuals and businesses, including almost $10 billion of additional tax relief for individuals through an expansion of the refundable child tax credit and a new standard deduction for property taxes.
The bill would be primarily offset by closing a tax loophole that allows individuals who work for certain offshore corporations, such as hedge fund managers, to defer tax on their compensation and would delay the effective date of a tax benefit that has not yet taken effect for multinational corporations operating overseas.
Energy Tax Incentives
Energy Production Incentives
H.R. 6049 would provide renewable energy incentives, including: