WASHINGTON — Sen. John Curtis, R-Utah, is joining calls to preserve some components of former President Joe Biden’s Inflation Reduction Act, calling them crucial to the country’s energy production and manufacturing.
In a letter to Senate Majority Leader John Thune, R-S.D., on Thursday, a group of four Republican senators cautioned against a full repeal of Biden’s signature climate bill, warning it could lead to “significant disruptions” and weaken the United States on the global stage. The letter comes as some House Republicans have demanded a full repeal of the IRA in the upcoming tax reconciliation package in exchange for their support.
“Our country is blessed with abundant natural resources and an entrepreneurial spirit that uniquely positions us to power both our economy and the world — enabling U.S. leadership in innovation, energy production, and manufacturing alike,” the senators wrote. “Many of the investments that make this possible are enabled by current tax provisions, including some from the Inflation Reduction Act.”
Three other Republicans signed on to the letter including Alaska Sen. Lisa Murkowski, who led the letter, as well as Sens. Thom Tillis, R-N.C., and Jerry Moran.
As part of its plea, the group is urging lawmakers tasked with drafting the reconciliation bill to consider “each existing tax credit” for its ability to spur domestic manufacturing, reduce utility costs, and ensure businesses receive “meaningful U.S. investments” based on the current tax structure.
If those tax credits are abruptly withdrawn, the senators argue, homes and businesses could be faced with worsening economic pressures and higher utility bills.
The letter comes amid a quiet feud over whether to preserve any provisions in Biden’s energy law, with some fiscal hawks in the House claiming it has driven up wasteful spending in the federal government since it was enacted in 2022.
When the IRA took effect, it was lauded by Democrats as a “historic investment” to transition to a clean energy economy while encouraging efficiency. But now, many of the provisions are on the chopping block after President Donald Trump vowed to dismantle federal efforts to address climate change as a major part of his reelection campaign.
That campaign promise appears to be at the center of an agreement between GOP leadership and Republican hardliners in order to pass a budget resolution this week that unlocks the path forward for Trump’s massive tax package.
As part of that agreement, the White House agreed to support “efforts to fully repeal the damaging ‘green scam’ subsidies in the Inflation Reduction Act,” according to Rep. Chip Roy, R-Texas. Eliminating those clean energy credits has emerged as a redline for Roy.
“I mean a full repeal, within like 99% (or) within some degree of certainty — you need to repeal all or yeah, I’m not going to be too favorably disposed for a reconciliation package that doesn’t repeal that,” Roy told the Deseret News last month. “The tax code can have provisions in it for investments and stuff, like your business costs. But that’s not the same thing. We don’t need subsidies for this crap.”
That could put Republicans on a collision course as they move forward with drafting the reconciliation package. Several House Republicans have also expressed support for preserving the green tax credits, which may present Johnson with a math problem to advance the final package.
But even if those Republicans are successful in preserving clean energy tax credits, it will make the task of finding cost offsets that much harder in the final package.
Under the House budget resolution, committees must find $2 trillion in spending cuts over the next decade split across seven committees. Those instructions include at least $880 billion in cuts from the Energy and Commerce Committee, which would leave little room for lawmakers to find if they vow not to cut from clean energy tax incentives or Medicaid and Social Security benefits.