With the Nation teetering on the verge of a recession, Congress and the President believe they must pass an economic stimulus package. Last night a tentative agreement was reached on a $145 billion economic stimulus package that would quickly send payments to the poor and middle class while offering businesses faster tax write-offs for corporate investment and immediate tax deductions for small-business investments in plants and equipment. Businesses also would be able to take tax deductions this year on operating losses from as long as five years ago.Every Member of Congress via the urging of interest groups will be lining up to add riders to the package. Of note for marketers, it is possible that an extension of the renewable energy tax credits will be in the package.* That would mean an extension of the biodiesel and ethanol tax credits, which are set to expire at the end of this year. The Senate Finance Committee still plans to put together provisions to be attached to the final bill.
Also, Senator Snowe (R-Maine) is fighting for full funding of the Low Income Home Energy Assistance Program (LIHEAP) at $5.1 billion and House Speaker Pelosi (D-Calif.) has set aside proposed funding increases for low-income heating assistance. PMAA has strongly urged Congress to fully fund the critical LIHEAP program.The process for passage of the package is for the House to take up the measure first, and for both chambers to pass the bill before President’s Day (February 18). It is likely that the regular committee process will be bypassed in order to move the package quickly. *Senate Finance Chairman Max Baucus has signaled he does not support renewing the tax credits.
*Senate Finance Chairman Max Baucus has signaled he does not support renewing the tax credits.