Wyden: Tie business R&D break with enhanced child tax credit
U.S. Sen. Ron Wyden says he wants the Senate Finance Committee during the post-election congressional session to tie the renewal of federal tax breaks for research and development with a longer extension of an enhanced child tax credit.
The Oregon Democrat was reelected to a fifth full term Nov. 8 with a majority of 56%. Because Democrats retained their majority in the Senate, Wyden will continue to lead the committee that has authority over tax, trade and health care legislation. He led it in 2014, and again in the past two years, when Democrats secured a majority.
"If you come out of the election, as I did, saying that the American people are looking for concrete specifics that are going to benefit their lives, I think Democrats have a way to deliver on that," Wyden told reporters on a conference call Nov. 15. "Benefits for business and benefits for families are going to result in better benefits for this country."
Business interests want Congress to reinstate tax breaks for research and development that were part of the $1.5 trillion tax cut plan passed by Republican congressional majorities in 2017 — the bill got no Democratic votes — and signed by then President Donald Trump.
Other groups want Congress to extend an enhanced child tax credit that was part of the $1.9 trillion American Rescue Plan Act, which was passed by Democratic congressional majorities in 2021 — the bill got no Republican votes — and signed by President Joe Biden.
The credit was increased from $2,000 to $3,000 for each child under age 6, and $3,600 for older children through age 17, The full credit applied to households earning less than $150,000 for joint returns, $112,500 for heads of households, and $75,000 for single filers. Some households qualified for six monthly payments from the Internal Revenue Service, the rest being paid when they filed their 2021 tax returns this year.
However, the expanded credit — which is credited with cutting the child poverty rate by 40% — was just for a single year.
Quoting Yogi Berra
Wyden was careful not to discuss specifics about how he might try to tie the two together.
He quoted baseball player Yogi Berra: "It's tough to make predictions, especially about the future."
But Wyden said he's committed to doing so in the weeks that Democrats still control both chambers of Congress.
"In a sense, I think both of these areas … amount to targeted investments that are going to rebound to the benefit of the American people for years to come," he said.
"If you want high-skilled, high-wage workers, you ought to give families the opportunity to learn and be in a position to take care of themselves so that children can have a brighter future.
"When it comes up, I'm going to say I am for both of these in an end-of-the-year package. Benefits for business need to be paired with benefits for families. They are smart investments."
Democrats will retain their thin majorities until the start of the 118th Congress on Jan. 3, when Republicans will take over the House by the barest margin of 218. (Some races have not been called.)
Until then, they can use a procedure known as budget reconciliation, which requires only a simple majority of 51 votes to pass a measure in the Senate, instead of the 60 needed to avert the threat of a filibuster. House rules do not allow filibusters in that chamber.
Democrats will keep at least 50 votes in the Senate — and a majority with the tie-breaking vote of Vice President Kamala Harris — and could pick up another seat if incumbent Raphael Warnock wins a runoff election against Republican Herschel Walker in Georgia on Dec. 6.
According to a report by the Center on Budget and Policy Priorities, an extension of the enhanced credit would benefit 19 million children nationally, 192,000 of them in Oregon.
"Rising costs have coincided with rising profits for corporations, while families with low incomes struggle to keep up," Alejandro Queral, executive director of the Oregon Center for Public Policy, said in a separate statement. "Congress must put families first by expanding the child tax credit."
The national report says, "The success of the 2021 expansion showed us that high child poverty rates are a policy choice, not an inevitability."
Wyden said Congress also should prepare to raise the federal debt ceiling during the post-election session by enough to forestall any attempt by Republicans in the House to hold it hostage in budget and related negotiations in 2023 and 2024. Their nominee for House speaker, Kevin McCarthy of California, has suggested it could be political leverage for Republicans to force Biden and Democrats to agree to spending cuts, even in Social Security and Medicare.
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