Senate Finance Committee Chairman Max Baucus (D-Montana) has unveiled a draft package of proposals to streamline energy-related tax incentives. The package would repeal a number of current tax incentives, including those for plug-in vehicles.
“It is time to bring our energy tax policy into the 21st century,” Senator Baucus said. “Our current set of energy tax incentives is overly complex and picks winners and losers with no clear policy rationale. We need a system of energy incentives that is more predictable, rational, and technology-neutral to increase our energy security and ensure a clean and healthy environment for future generations.”
Under current law, there are 42 different energy tax incentives, including more than a dozen preferences for fossil fuels, ten incentives for renewable fuels and alternative vehicles, and six credits for clean electricity. Of the 42 incentives, 25 are temporary and expire every year or two, and the credits for clean electricity alone have been adjusted 14 times since 1978. To address these issues, Senator Baucus’s draft proposes a smaller number of targeted and simple energy incentives that are flexible enough to accommodate advances among fuels and technologies of any type.
Senator Baucus called for feedback from the general public on the discussion draft. Comments can be sent to: Tax_Reform@Finance.Senate.gov, and are requested by January 31, 2014.