A document obtained by several news agencies last week shows Democrats preparing to target tax breaks for the wealthy and corporations as part of congressional negotiations to meet a Dec. 13 deadline for a budget deal.
Not on the list of Democrats’ targets: tax breaks for the fossil fuel industry.
The Hill reported that the list
contains 12 examples of the types of “tax loopholes” that [Democrats] would like to see closed in a year-end budget deal. Most have been proposed many times before.
Combined, the items on the list would raise $264 billion in revenue over 10 years, more than enough to switch off two years’ worth of the automatic budget cuts known as sequestration.
Bloomberg reported that
In addition to closing what Democrats call the “John Edwards/Newt Gingrich loophole,” the party’s list of options includes carried-interest treatment that allows hedge fund managers and private equity advisers to pay a 20 percent tax rate on their income instead of the nation’s top income rate of 39.6 percent. Ending that break would save more than $17 billion over a decade, according to the Democrats’ estimates.
Another lets U.S. companies deduct their expenses when they send their plants overseas, which Democrats say encourages offshoring of American jobs. It would raise $200 million. Ending preferences for corporate jets and subsidies for yachts and vacation homes, combined, would bring in another $19 billion.
“The list makes clear that Democrats believe they can win public support by targeting tax breaks that they can portray as subsidies for the rich,” according to Reuters.
Republicans have been demanding cuts in Social Security and Medicare in exchange for changes to sequestration spending cuts, and that has failed to be met by a widespread Democratic pushback.
Progressives like Sen. Bernie Sanders (I-Vt.) have called for and “End [to] tax breaks and subsidies for oil, gas and coal companies to reduce the deficit by more than $113 billion over the next 10 years”–a call echoed by the Congressional Progressive Caucus’s “Back to Work Budget,” which calls for an elimination of corporate tax subsidies for oil, gas, and coal companies.
But preserving tax breaks for the fossil fuel industry appears to have widspread bipartisan consensus.
Fossil fuel companies not being on the list of dozen targets may be a result of Democrats’ “embrace” of fossil fuels, the Financial Times reported.
James Politi reported at the Financial Times that the omission may “point to an increasing willingness among Democrats to embrace America’s domestic energy boom as a source of economic strength.”
The FT also quotes the American Petroleum Institute as saying there is “growing bipartisan opposition” to taxes that target oil and gas industries.
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Source: Common Dreams