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November 03, 2014 at 08:26 AM
Predictions a day before the midterm elections still favored Republicans regaining control of the Senate as well as picking up seats in the House, but political watchers are questioning the likelihood that a tax extenders package will pass in the lame-duck session and are looking to the impending debt limit deadline.
Washington Analysis reiterated in its Friday commentary Republicans’ 65% chance of regaining the Senate this year, with “virtually zero chance that they [the GOP] will lose seats in either chamber.” Instead, the GOP is expected to gain five to 10 seats in the House as well.
Greg Valliere, chief political strategist at Potomac Research, said in his Friday commentary that passage of the “huge” tax extenders package retroactive to Jan. 1, 2014, in the lame-duck session “may be in trouble,” as the price tag for a two-year extension of the extenders “is at least $85 billion, and no one has any idea how to pay for that.”
Rep. Paul Ryan, R-Wis., the “probable” new chairman of the House Ways and Means Committee, “believes the House doesn’t have to pay for tax cuts,” Valliere says. “But he [Ryan] faces opposition from fiscal conservatives who ask why the government should be picking winners and losers in, for example, energy efficiency tax credits. And besides, passage of these extenders could complicate the drive for fundamental tax reform next year.”
Valliere adds that Congress could perhaps “pass a handful of important extenders — such as the research and development tax credit — during the lame-duck session.”
IRS Commissioner John Koskinen told members of the Senate Finance Committee in mid-October that Congress should act on the extenders package “no later than the end of November,” stating that the IRS was “currently facing a great deal of uncertainty related to the expired provisions, which raises serious operations and compliance risks.”
