The Subcommittee on Select Revenue Measures and Subcommittee on Oversight of the House Ways & Means Committee hold a joint hearing today on Energy Tax Policy and Tax Reform:

The hearing will focus on the questions of whether energy policy should be conducted through the tax code, and if so, how best to design provisions that advance the principles of both sustainable energy policy and tax reform. In asking these questions, the hearing will conduct oversight of the administration of certain existing energy tax provisions to determine whether they have been implemented efficiently and effectively. It also will consider how the specific case of H.R. 1380, the NAT GAS Act, stacks up against the principles of tax reform and sustainable energy policy. 

Panel #1:

• J. Russell George (Treasury Inspector General for Tax Administration)
• Richard E. Byrd, Jr. (Commissioner, Wage and Investment Division, IRS)

Panel # 2:

• Donald B. Marron (Director, Tax Policy Center)
• Kevin Book (Managing Director, Research, Clearview Energy Partners)
• Neil Z. Auerbach (Founder and Managing Partner, Hudson Clean Energy Partners)
• Will Coleman (Partner, Mohr Davidow Ventures)
• Tim Greeff (Political Director, Clean Economy Network)

Panel # 3:

• Andrew J. Littlefair (President & CEO), Clean Energy Fuels
• Lawrence B. Lindsey (President & CEO, The Lindsey Group)
• Calvin Dooley (President & CEO, American Chemistry Council)
• David W. Kreutzer (Research Fellow, The Heritage Foundation)
• Hank Ziomek (Director of Sales, Titeflex Corporation)
  

In connection with the hearing, the Joint Committee on Taxation has released Present Law and Analysis of Energy-Related Tax Expenditures and Description of the Revenue Provisions Contained in H.R. 1380, The New Alternative Transportation to Give Americans Solutions Act of 2011 (JCX-47-11) (33 pages):

Part I of this document … provides tables that summarize present-law energy-related Federal tax incentives.

Part II of this document provides a brief discussion of the economic rationale for certain government intervention in energy markets through the tax code, and issues related to the proper design of such tax preferences. These tax expenditures create incentives that have the potential to affect economic decisions and allocate economic resources from other uses to the tax-favored uses. Such tax preferences may produce an allocation of resources that is more efficient for society at large if they are properly designed to overcome negative effects (such as atmospheric pollution, for example) that would otherwise result from a purely market based outcome without any government intervention. Tax expenditures for energy production and conservation have been criticized for lacking well defined objectives, and for lacking coordination among provisions having similar objectives. Some argue that the simultaneous existence of tax preferences for the fossil fuel industry and for renewable energy production represents a conflicting government policy. Others have noted that the incentives for renewable energy and conservation are not themselves designed in a coordinated way to produce the most efficient or equitable subsidies for renewable energy and conservation.

Part III of this document describes the revenue provisions contained in H.R. 1380, the New Alternative Transportation to Give Americans Solutions Act of 2011.