A group of 21 House Republicans is asking a key committee to limit changes to energy tax credits passed under Democrats as the GOP seeks to overhaul the U.S. tax code.
In a new letter dated Sunday, the group of mostly moderate Republicans asked that any changes to energy tax credits be “targeted and pragmatic.”
“We request that any proposed changes to the tax code be conducted in a targeted and pragmatic fashion that promotes conference priorities without undoing current and future private sector investments which will continue to increase domestic manufacturing, promote energy innovation, and keep utility costs down,” they wrote to Rep. Jason Smith (R-Mo.), who chairs the House Ways and Means Committee.
The letter, which was first reported by Politico, is indicative of a broader challenge House Republicans face as they seek to reform the tax code through a process called reconciliation that only requires a simple majority.
Their small majority in the House means that virtually the entire caucus needs to remain in agreement to pass such legislation — something that moderates and Freedom Caucus members alike could seek to exploit as they push for their interests to be included.
The new letter comes after House Speaker Mike Johnson (R-La.) said that his approach to the tax credits would be “somewhere between a scalpel and a sledgehammer.” He previously said last fall that Republicans would use a “scalpel.”
The energy credits issue is tough for Republicans because a significant number of energy projects sprung up in red and purple districts or states — meaning a repeal of such credits could harm economies in some places where the GOP governs.
And different districts have different types of energy projects — so as one district may have a solar or wind farm, another may have an electric vehicle battery plant.
But the GOP will also need significant cuts to pay for the tax credits they are hoping to enact, and the hundreds of billions’ worth of energy tax credits could be part of that.
This is not the first time a contingent of Republicans expressed concerns about the potential repeal of the credits — many of the same lawmakers signed on to a separate letter last year that warned against a full repeal of the credits.
In their new letter on Friday, the 21 members wrote that “as our conference works to make energy prices more affordable, tax reforms that would raise energy costs for hard-working Americans would be contrary to this goal.”
