1. Christmas deadline.
Republicans have a busy week ahead as they rush to pass their tax bill and avoid a government shutdown.
- Republican leadership hopes to vote on the compromise tax bill beginning tomorrow and then tackle a spending bill, which they will need Democrats’ support to pass.
- Last night Sen. John McCain (R-Ariz.) returned home to Arizona to recover from ongoing chemotherapy treatments and will miss the tax vote. The passage of the bill, however, does not depend on McCain’s support and currently should pass 52-48 unless there are any last-minute defectors.
- Take a look at what made it into the final bill.
- Unlike the tax bill, the GOP will need all the support it can get in passing a temporary spending bill. The House filed a bill last week that would extend funding for most agencies through mid-January, with a longer extension and increased funding for military programs. This bill is considered dead on arrival in the Senate due to its lack of Democrat support.
2. Relieved renewables?
The renewable energy industry is breathing a short sigh of relief as the final tax bill left crucial tax credits intact, but another provision in the tax package proves to be worrisome.
- The compromise tax bill retains tax credits for wind and solar energy production and investment, and also eliminates an “alternative minimum tax” that would have reduced the value of those credits.
- The final bill still includes a Base Erosion Anti-Abuse Tax (BEAT) that keeps 80 percent of the investment tax credit (ITC) and production tax credit (PTC) values. The compromise bill includes somewhat of a BEAT fix that will allow corporations to continue using ITC and PTC credits to lower their taxable income, which leaves in place a crucial financing mechanism for renewable projects.
- The BEAT provision could, however, apply to more companies and banks than before, which would result in more renewable energy investors being subject to the tax. Experts are still analyzing the bill’s full effect on the renewables industry.
3. Two for one.
While they were unable to pass healthcare reform earlier this year, Republicans have kept a sliver of Obamacare repeal in their final tax reform package.
- The compromise tax bill eliminates the Obamacare mandate that all Americans have health insurance, as well as the fee applied to those who were uninsured. Some groups, including the American Hospital Association, oppose this provision, but many Republicans see it as a win.
- The impact of the individual mandate repeal continues to be a topic of debate among healthcare policy experts, but the Congressional Budget Office (CBO) predicts about 4 million people would lose coverage during the first year the repeal is in effect.
- The CBO estimates that the number of uninsured Americans would more than triple by 2027, and premiums would likely jump by about 10 percent. Other analysts, however, argue that fewer people will be uninsured once the mandate is repealed.