Congress is fairly likely during its post-election session to revive a package of tax incentives that expired on Jan 1, said the leaders of the two largest U.S. farm groups. The package includes the $1 a gallon tax credit for biodiesel, tax credits for wind and solar power, and generous write-offs for purchases of equipment and other assets. Bob Stallman, president of the American Farm Bureau Federation, told reporters the so-called tax extenders package was “front and center” for action and “the most likely thing” to get done during the lame duck session, along with passage of a government funding bill.
In an interview, president Roger Johnson of the National Farmers Union tabbed tax extenders as the most important issue for agriculture that was likely to see action in the fall session. There would be “enormous problems” if the lapse in tax breaks carries into the new year, he said.
The Senate Finance Committee has proposed a two-year extension of the tax breaks, retroactive to the start of this year. The House passed bills to extend three tax breaks for agriculture but not an overall package. Two tax breaks important to the ag sector are so-called Section 179, which allows small businesses to immediately list purchases of assets as an expense, rather than being required to depreciate them over time, and a “bonus depreciation” provision that allows an additional 50 percent depreciation of new capital assets. The maximum amount that can be expensed through Section 179 is $25,000; it used to be $500,000.
During a luncheon, Stallman said AFBF will look for every opportunity to legislatively block EPA’s proposed Waters of the United States rule. “We’re not going to back off,” he said, but Congress probably will not act on it during the lame duck session. An AFBF staff worker said there might be an opening this fall if congressional leaders decide to draft an omnibus appropriations bill, which could carry a “rider” against the EPA rule. The House has voted to block the rule for this fiscal year.
Johnson said “nothing needs to be done” by Congress on country-of-origin meat-labeling rules. The WTO ruled on Oct 20 that the U.S. rules discriminate against Canadian and Mexican livestock. Stallman said the labeling rules probably would not be overhauled until “some pain” is felt in the United States.
Canada has threatened to impose hundreds of millions of dollars in retaliatory tariffs on U.S. exports. Johnson said the administration was certain to appeal the WTO ruling, so months will pass before anything happens. Meatpackers want repeal of the labeling law.