Allow Energy Tax Credits to Expire
Two dozen technology-specific, energy-related tax provisions expire at the end of 2016. Instead of addressing each of these tax provisions on its own merit, Congress has traditionally manufactured crises around deadline events to justify moving them all forward in one package of tax extenders. Energy tax provisions slated to expire this year would divert at least $7.8 billion in tax dollars if renewed for another year.
Subsidies do not make energy resources and technology less expensive; they just make more people—namely, taxpayers—pay for them. America has a diverse energy sector, and the market incentive to supply affordable electricity and competitive transportation fuels is enough to spur private investment without any preferential treatment from the federal government. Such treatment has costly unintended consequences on energy markets and Americans’ choices.
The only way to truly level the playing field is to eliminate all targeted subsidies for every energy resource. Congress should allow the energy-related tax credits to expire at the end of the year and eliminate all targeted tax credits for all energy sources and enable free enterprise to drive energy investments.