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Ag, energy and transportation groups urge tax extenders package

Legislative Watch: Extension of tax extenders encouraged; food label history studied; Senate becomes a house more closely divided.

P. Scott Shearer

January 5, 2018

4 Min Read
Ag, energy and transportation groups urge tax extenders package

Now that Congress has passed a major tax bill, a number of agriculture, energy and transportation organizations are urging Congress to pass a tax extender’s bill that would extend a number of temporary tax provisions. Many of these tax provisions expired the end of 2016.

The “Tax Extenders Act of 2017” (S 2256) introduced by Sen. Orin Hatch (R-UT), chairman of the Senate Finance Committee, would extend various tax credits for biodiesel, renewable energy, rail and business. The tax provisions that would be extended include:

• $1.01 per gallon income tax credit for cellulosic biofuel
• $1 per gallon biodiesel and renewable diesel tax credits for biodiesel and blending biodiesel
• 10 cents per gallon Small Agri-Biodiesel Producer Credit
• $1 per gallon biodiesel excise tax credit
• 30% investment tax credit for installing alternative vehicle refueling property
• Investment tax credit for installation costs of facilities that produce electricity from wind
• Distributed Wind Investment Tax Credit for electricity production facilities
• Accelerated depreciation of businesses on Indian Reservations

The groups say, “Acting to extend these expired tax provisions will allow businesses and individuals to make important planning decisions. Allowing these tax provisions to remain lapsed creates confusion in the marketplace, and effectively increases taxes on entities that create jobs and economic growth.”

Those signing the letter include the American Farm Bureau Federation, American Gas Association, American Soybean Association, National Biodiesel Board, National Association of Truckstop Operators, National Corn Growers Association, National Council of Farmer Cooperatives and National Renderers Association.

30 years of experience in food labels studied
A recent USDA study on food labels found that food labels have expanded over the past 30 years with some having been federally mandated and some voluntary. The Economic Research Service study, “Beyond Nutrition and Organic Labels — 30 Years of Experience with Intervening in Food Labels,” found some labels can mislead consumers. This is due to food companies voluntarily offering “only information that increases demand for their products.” Also, consumers may not understand the labeling claims.

The ERS report looked at five case studies from the past 30 years that look at the role the federal government has had in food labels and the “informational strengths and weaknesses of various labels.” Some of the findings from the ERS report include:

• “The federal government has developed uniform standards for disclosure and claims about some product attributes, and doing so led to labels that are credible and truthful. However, there are tradeoffs to consider.

○ The history of nutrition and organic labeling shows that creating a single, national standard can be a slow process, lasting many years.

○ Food manufacturers often compete on the basis of the product attributes they offer, and they work to make consumers aware of differences. In those cases, mandating label information may not make consumers better informed as they can already deduce everything they want to know about products, labeled or not.

○ Government standards for labeling some food product attributes have been rigidly defined, making alternative definitions illegal. This can discourage innovation and experimentation in marketing and product development.

• Once a single, mandatory, federally set standard is achieved, it does not automatically result in improved consumer understanding.

○ Consumers sometimes confuse government standards with other standards. For example, the USDA organic seal is often confused with other label claims, such as “natural” or “raised without antibiotics” that have fewer and/or lower standards and lower production costs.

○ The mandatory country-of-origin label gives consumers complete information about the origin of products covered, but no information at all about product quality. Nonetheless, some consumers automatically equate domestic production with higher quality — an assumption that may or may not be correct.

• Where there is no single, national standard for a food attribute and food suppliers develop product definitions and standards, label information may not be consistent and may mislead consumers. These labels may not be truthful or understandable.

• Positive environmental effects of labeling alternatively produced foods are limited by market size.

• Government and third parties compete to educate consumers about food product attributes.”

Changes come in the Senate
Republicans find themselves in an even more closely divided Senate (51-49) with the swearing-in this week of newly elected Sen. Doug Jones (D-AL). Jones is the first Democrat to be elected Senator from Alabama in 25 years. Tina Smith (D-MN) was sworn-in as the new Senator from Minnesota replacing Sen. Al Franken who resigned this week. Smith had been serving as Minnesota’s lieutenant governor. There are now 22 women Senators, which is a record.

About the Author(s)

P. Scott Shearer

Vice President, Bockorny Group, Inc.

Scott Shearer is vice president of the Bockorny Group Inc., a leading bipartisan government affairs consulting firm in Washington, D.C. With more than 30 years experience in government and corporate relations in state and national arenas, he is recognized as a leader in agricultural trade issues, having served as co-chairman of the Agricultural Coalition for U.S.-China Trade and co-chairman of the Agricultural Coalition for Trade Promotion Authority. Scott was instrumental in the passage of China Permanent Normal Trade Relations and TPA. He is past chairman of the USDA-USTR Agricultural Technical Advisory Committee for Trade in Animals and Animal Products and was a member of the USAID Food Security Advisory Committee. Prior to joining the Bockorny Group, Scott served as director of national relations for Farmland Industries Inc., as well as USDA’s Deputy Assistant Secretary for Congressional Affairs (1993-96), serving as liaison for the Secretary of Agriculture and the USDA to Congress.

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