Politicking is still causing a number of popular tax breaks to be held up in Congress.With the 109th Congress scheduled to wrap up its business at the end of next week, a number of expiring tax measures still have yet to be renewed.
The latest contentious measures to be attached to the breaks, in a bill introduced by leaders of the Senate Finance Committee, include proposals to:
- Expand offshore oil drilling;
- Cancel a Medicare payment cut for doctors;
- Provide more money to clean up abandoned coalmines;
- Grant permanent normal trading relations to Vietnam, a measure that failed last month in the House; and,
- Extend trade relationships with sub-Saharan and Andean countries, as well as other developing nations, such as a controversial addition to grant Haitian clothing duty-free entry into the United States.
In the meantime, business lobbyists have loudly called for restoration of the expiring research and development credit, which is worth $7.5 billion in this fiscal year alone.The bills in circulation would extend the R&D credit, among others, through December 2007 -- most expired last December, but if Congress does not act, many businesses and individual taxpayers will be unable to claim them in April.
Other breaks being held in limbo include a reward for employers who hire former welfare recipients, a personal deduction for state and local sales taxes paid by people who live in states without income taxes, and a personal deduction for elementary and high school teachers who spend at least $250 of their own money on classroom supplies.
Most recently, the tax extensions were attached to a July bill that would have raised the minimum wage and permanently cut the estate tax. The bill passed the House, but was blocked in the Senate.
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