Paul L. Caron

Tuesday, June 16, 2009

Senate Holds Hearing Today on Climate Change Legislation: Tax Considerations

The Senate Finance Committee holds a hearing today on Climate Change Legislation: Tax Considerations.  Here are the witnesses scheduled to testify:

  • Gary Hufbauer (Reginald Jones Senior Fellow, Peterson Institute for International Economics, Washington D.C.)
  • Mark Price (Principal-in-Charge, Financial Institutions and Products, Washington National Tax, KPMG, Washington,  D.C.)
  • Keith Butler (Senior Vice President of Tax, Duke Energy, Charlotte, NC)

In connection with the hearing, the Joint Committee on Taxation has released Climate Change Legislation: Tax Considerations (JCX-29-09):

This document ... provides a discussion of Federal income tax issues relating to cap-and-trade proposals. The first section describes the basic design features common to cap-and-trade proposals. The sections that follow discuss the fundamental income tax issues raised by cap and trade proposals, including (1) taxation of allocated emission allowances; (2) recovery of basis in emission allowances; (3) taxation of offset producers; and (4) taxation of the sale or exchange of emission allowances. The remaining sections discuss the tax aspects of trading emission allowances and emission allowance derivatives, international tax considerations, sales and exchanges of emission allowances by tax exempt organizations, and the imposition of penalties.

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I hope they can figure out how much this is going to cost us, and how much money the governments will earn from it. So far no one, including the authors of this bill, seem to have the slightest clue.

Posted by: Ken | Jun 21, 2009 4:47:06 AM