Budget deal is brimming with special tax breaks

The Bipartisan Budget Act that Congress is set to pass Thursday is brimming with tax provisions for a variety of special interests, including racehorse owners, small private colleges and television and film companies.

At least two of the tax breaks help the constituents of Senate Majority Leader Mitch McConnellAddison (Mitch) Mitchell McConnellTrump Jr. inches past DeSantis as most popular GOP figure in new poll: Axios House rejects GOP effort to seat McCarthy's picks for Jan. 6 panel Senators scramble to save infrastructure deal MORE (R-Ky.), who negotiated the deal with Democratic Leader Charles SchumerChuck Schumer84 mayors call for immigration to be included in reconciliation Senate infrastructure talks on shaky grounds Could Andrew Cuomo — despite scandals — be re-elected because of Trump? MORE (N.Y.). 

Altogether, the special tax provisions amount to $17.4 billion over the next four years, with most of the costs incurred — $13.3 billion — in fiscal year 2018, according to an analysis released by the Joint Committee on Taxation (JCT).

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One provision limits the excise tax on investment income at private colleges and universities to schools with at least 500 tuition-paying students, shielding smaller institutions and costing the government an estimated $2 million a year in revenue over the next decade.

It’s a win for small schools such as Berea College, which is based in Kentucky.

Senate Republicans tried to exempt small colleges such as Berea in the tax-reform bill that passed in December, but the provision was removed after the parliamentarian said it violated procedural rules.

Another provision in the deal extends the three-year tax depreciation for racehorses, allowing owners to depreciate the value of their investment over the most productive span of their racing careers instead of the old seven-year schedule. 

That provision was a top priority of the National Thoroughbred Racing Association, which also happens to be based in McConnell’s home state.  

It also extends special expensing rules for film and television productions, giving a boost to Hollywood, a Democratic fundraising hub, and to live theater productions, a boon to Schumer’s home state of New York.

Schumer has argued that live theater productions should reap the same tax benefits as film and television and warned in the past that without tax incentives, production companies would move away from costly New York City. 

That provision will cost the government $1.3 billion in fiscal year 2018. 

NASCAR track owners will get to share in $37 million in tax benefits thanks to an extension of the seven-year recovery period for motorsports entertainment complexes.

That tax break has been supported by Sen. Debbie StabenowDeborah (Debbie) Ann StabenowHere's evidence the Senate confirmation process is broken Schumer: Democrats considering option to pay for all of infrastructure agenda Democrats closing in on deal to unlock massive infrastructure bill MORE (D-Mich.), one of Schumer’s closest allies. Her state is home to major automobile manufacturers and the Michigan International Speedway.

Sen. Dean HellerDean Arthur HellerDemocrat Jacky Rosen becomes 22nd senator to back bipartisan infrastructure deal 9 Senate seats most likely to flip in 2022 On The Trail: Democrats plan to hammer Trump on Social Security, Medicare MORE (Nev.), who represents the Las Vegas Motor Speedway, Sen. Pat RobertsCharles (Pat) Patrick RobertsBob Dole, Pat Roberts endorse Kansas AG Derek Schmidt for governor Ex-Sen. Cory Gardner joins lobbying firm Senate GOP faces retirement brain drain MORE (R-Kan.), who has the Kansas Speedway, and Sen. Richard BurrRichard Mauze BurrBipartisan group says it's still on track after setback on Senate floor Bipartisan group to issue 'promising' statement on infrastructure path forward First responders shouldn't have to tackle tigers MORE (R), whose home state of North Carolina is a NASCAR hotbed, also support the provision. 

Republican senators won other tax breaks they endorsed. 

Sens. Johnny IsaksonJohnny IsaksonCritical race theory becomes focus of midterms Former Georgia ethics official to challenge McBath Loeffler meets with McConnell amid speculation of another Senate run MORE (R-Ga.), Tim ScottTimothy (Tim) Eugene ScottScott: 'There is hope' for police reform bill Sunday shows preview: Bipartisan infrastructure talks drag on; Democrats plow ahead with Jan. 6 probe Noem to travel to South Carolina for early voting event MORE (R-S.C.) and Lindsey GrahamLindsey Olin GrahamGOP sees debt ceiling as its leverage against Biden DACA court ruling puts weight of immigration reform on Democrats Senate braces for a nasty debt ceiling fight MORE (R-S.C.) scored with the inclusion of an energy tax credit for advanced nuclear power facilities, which will cost $12.2 billion in 2018.

Sen. Chuck GrassleyChuck GrassleyThe Hill's Morning Report - Presented by Facebook - Jan. 6 probe, infrastructure to dominate week Grassley pressured to run as Democrats set sights on Iowa The Hill's Morning Report - Pelosi considers adding GOP voices to Jan. 6 panel MORE (R-Iowa), a champion of whistleblowers, will be happy about a provision unifying the tax treatment of awards to people who uncover corruption. That and language clarifying whistleblower awards will cost $187 million over 10 years.  

The bill provides $594 million in tax relief for people affected by the devastating California wildfires, including an employee retention tax credit for employers who suffered losses such as wineries in North California. 

It’s a victory for Sen. Dianne FeinsteinDianne Emiel FeinsteinBiden signs bill to bolster crime victims fund Stripping opportunity from DC's children Progressive groups ask for town hall with Feinstein to talk filibuster MORE (D-Calif.), who faces a primary challenge this year. She and other members of the California delegation had pushed for wildfire victims to get the same treatment as hurricane victims. 

Businesses affected by hurricanes Harvey and Irma will also benefit from an employee-retention tax credit.

Another provision extends tax relief for the plug-in electric motorcycles, which will help manufacturers such as Zero Motorcycles, based outside of Santa Cruz, Calif..  

Richard Walker, the CEO of the company, has touted the tax break as helping to create jobs and invest in clean technology.

The deal also extends for one year the alternative motor vehicle credit for qualified fuel cell vehicles, at a cost of $4 million. 

It’s one of many environmentally friendly tax credits, including breaks for biodiesel, energy-efficient home construction and modifications, non-wind renewable power facilities, and second-generation biofuel plants.