By Timothy Cama - 09/17/14 02:54 PM EDT
The Senate’s top tax lawmaker Wednesday expressed support for moving toward a “technology-neutral” system of tax incentives for energy production.
Sen. Ron WydenRon WydenOvernight Finance: Puerto Rico bill clears panel | IRS chief vows to finish term | Bill would require nominees to release tax returns Top Dem: CIA officials thought spying on Senate ‘was flat out wrong’ The Trail 2016: Hell breaks loose MORE (D-Ore.) endorsed the idea as an effort to simplify the United States’ tax code, including different tax breaks for different energy sources, some of which have expired.
“The disparity in how the tax code treats energy sources — and the uncertainty it causes — has to end,” he said.
Wyden, who has backed tax breaks for renewable energy including the wind production tax credit that expired last year, said that fossil fuels generally benefit from incentives that do not expire. But renewables have to deal with “stop-and-go” credits that have to be passed by Congress each year.
Sen. Michael BennetMichael BennetLawmakers push to elevate Cyber Command in Senate defense bill GOP ad calls Clinton 'a living history of scandal' Trump, GOP agree: ObamaCare helps us MORE (D-Colo.) also backed incentives that do not discriminate on technology, though warned that “it’s important for us to get the details right.”
Wyden’s hearing is part of an effort he launched earlier this year when he took control of the Senate Finance Committee to write a “comprehensive” tax reform package. He was chairman of the Energy and Natural Resources Committee before he shifted to the tax panel.
Sen. Mike EnziMike EnziGOP blocks slate of Obama judicial nominees Overnight Finance: New rules proposed to curb Wall Street pay GOP senator tries to tie 'No budget, no pay' to funding bill MORE (R-Wyo.) warned against eliminated tax policies that benefit the oil and natural gas industry, such as the ability to deduct drilling costs.
“Those are comparable, perhaps, to research and development, but I think they’re more comparable to amortization and depreciation,” he said. “So the loss of this deduction for producers would reduce their available capital immensely.”
While not endorsing Wyden’s technology-neutral approach, Sen. Debbie Stabenow (D-Mich.) said it is important to level the playing field between fossil fuels and alternative energy.
“The reality is that we’ve had a permanent tax policy since 1916 in some way incentivizing or supporting oil,” she said, estimating that fossil energy companies have received $166 billion in tax incentives in the last three decades.
“We picked a winner, and they won,” Stabenow said. “So now the question is, can we create more competition for different kinds of energy and create a policy that makes sense for all of them?”