The Senate this week tackles a bipartisan border security compromise that likely faces unsurmountable opposition from House Republicans and former President Donald Trump.
A bipartisan tax bill that passed the House overwhelmingly last week has a better chance of becoming law, but Republican critics in the Senate are determined to at least slow down the legislation. The bill includes popular tax breaks with farmers and businesses of all sizes as well as an expansion of the child tax credit.
A $118 billion supplemental spending package released Sunday evening includes border security measures as well as aid for Israel and Ukraine. A Senate vote is planned for Wednesday. Among other things, the border security measures overhaul the asylum process and provide new emergency authority to the Department of Homeland Security.
House Republican leaders have been attacking the border security negotiations for weeks. "Let me be clear: The Senate Border Bill will NOT receive a vote in the House," House Majority Leader Steve Scalise, R-La., said in a post on X Sunday night.
One of the Senate negotiators last week pleaded for colleagues to take the time to read the text before deciding to vote against it.
“We've got a lot of smart folks in this building, and they can read, and so when the text comes out, senators will read the legislation and make a decision based on the text,” Sen. Kyrsten Sinema, an Arizona independent who was one of the bill's negotiators, told reporters outside the Senate chamber. “And then everyone gets to decide: Do you want to secure the border or no?”
House Speaker Mike Johnson, R-La., has been in regular contact with Trump about the bill and has railed for weeks against what he said he expected to be in the bill. In a counter to the Senate legislation, he announced Saturday that the House will vote this week on a $17 billion supplemental spending bill that’s focused solely on aid to Israel.
Interviewed on NBC's Meet the Press Sunday, Johnson insisted that Trump is “not calling the shots” on border security. “I'm the one calling the shots for the House.”
But the White House quickly signaled opposition to Johnson’s plan. It “does nothing to secure the border, does nothing to help the people of Ukraine defend themselves against Putin’s aggression, and denies humanitarian assistance to Palestinian civilians, the majority of them women and children, which the Israelis supported by opening the access route,” said White House press secretary Karine Jean-Pierre.
Meanwhile, House Ways and Means Committee Chairman Jason Smith, a Missouri Republican who negotiated the tax bill directly with Senate Finance Chairman Ron Wyden, D-Ore., is keeping the pressure on his Senate GOP colleagues to support the legislation, citing the business tax breaks at stake.
The bill includes the restoration of 100% bonus depreciation as well as an increase in limits for the Section 179 expensing allowance and immediate expensing for corporate research and development.
Smith claimed in a statement Friday that as many as 1 million jobs could be lost if the tax provisions aren’t enacted.
“Our tax relief package will help make the difference for millions of small businesses trying to make payroll, while they build things here in America. The House has done its job to protect workers. The Senate should pass this bill and get it to the president’s desk as soon as possible,” Smith said.
The existing Section 179 provision allows businesses to write off up to $1.16 million of the cost of equipment and software for 2023, with the limit phased down dollar for dollar as spending exceeds $2.9 million. The House-passed bill would raise the expensing limit to $1.29 million and increase the phaseout threshold to $3.22 million, with both indexed to inflation.
The bonus depreciation provision, which allows a business to immediately write off the cost of equipment or buildings, is scheduled to phase out under the 2017 Tax Cuts and Jobs Act. The provision dropped from 100% to 80% of the purchase price in 2023 and is scheduled to fall to 60% this year, 40% in 2025 and 20% in 2026 before ending in 2027.
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Senate Republicans are insisting on the chance to debate amendments to the bill and have raised several concerns about the legislation, including the potential for the expanded child tax credit to help President Joe Biden’s reelection campaign. Conservatives in the House and Senate have also argued that the expanded child tax credit would encourage parents to drop out of the workforce.
“It's got a way to go,” Sen. Jerry Moran, R-Kan., said of the bill. He told Agri-Pulse it would only be “natural” for Republicans to insist on a chance to amend the measure.
Sen. Chuck Grassley, R-Iowa., acknowledged last week that bonus depreciation and Section 179 were a “big deal” to farmers, but he said Congress should wait to do anything about them until the next Congress when key provisions of the 2017 TCJA expire. Those provisions include the Section 199A deduction on business income and an increased estate tax exemption.
Also this week, USDA on Wednesday will release the first forecast for farm income in 2024. In December, USDA estimated that net cash farm income for 2023 at $157.9 billion, a 23.8% decrease from 2022 when adjusted for inflation but still 15% above the 20-year average.
Also on Wednesday, the Federal Maritime Commission will hold a hearing on the Red Sea shipping disruptions. The witnesses will include Peter Friedman, executive director of the Agriculture Transportation Coalition, and Eric Bartsch, secretary of the USA Dry Pea & Lentil Council.
The disruptions have raised insurance costs for vessels and significantly increased shipping times for grains moving out of Europe and the Black Sea, said Joe Glauber, a senior fellow at the International Food Policy Research Institute.
Here is a list of agriculture- or rural-related events scheduled for this week in Washington and elsewhere (all times EDT):
Monday, Feb. 5
National Association of State Departments of Agriculture winter policy conference, through Wednesday, Conrad Washington.
Crop Insurance Industry Annual Convention, through Wednesday, Scottsdale, Ariz.
Tuesday, Feb. 6
Clean Fuels Conference 2024, through Thursday, Fort Worth.
Wednesday, Feb. 7
9 a.m. — House Ways and Means subcommittee hearing on the World Trade Organization’s upcoming 13th Ministerial Meeting, 1100 Longworth.
10 a.m. — Federal Maritime Commission hearing on the Red Sea shipping disruptions, 395 E St. SW.
11 a.m. — USDA releases 2024 Farm Income Forecast.
Thursday, Feb. 8
8:30 a.m. — USDA releases Weekly Export Sales report.
Noon — USDA releases the monthly World Agricultural Supply and Demand Estimates and the Crop Production report.
Friday, Feb. 9
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