Oregon wine grapes could go unpressed and it’s Congress’ fault, said Senate Finance Committee Chairman Ron Wyden on Monday.
In a release urging congressional action on a package of expired tax breaks known as tax extenders, the Beaver State Democrat uses the state’s wine industry as an example of why Congress should act.
“For example, because Congress has not renewed increased expensing limits under Section 179, industrious Oregon wine makers will be forced to pay more for a new wine press needed today to expand their business, or they may be forced to choose between new equipment and hiring new employees,” Wyden said. So-called section 179 expensing allows small businesses to get their entire depreciation deduction in one year, rather than taking it a little at a time over the term of an asset’s useful life — which can be up to 39 years.
Oregon is the third-largest viniferous grape-growing region in the U.S, according to the Oregon Wine Board, a semi-independent Oregon state agency.
Oregon has 463 wineries situated mostly in 17 American Viticulture Areas throughout the state. The modern industry began in the 1960s and produces 72 different varieties of grapes, including pinot noir wines, which represent more than half of total production.
Oregon enjoyed a record harvest of more than 42,000 tons in 2011 and sold more than 2 million cases of wine for the first time, the board said. A 2010 study showed that the wine industry contributed $2.7 billion to the state's economy and represented 13,500 jobs, the board said. The wine industry is a key component of the state's $8 billion tourism industry.
Wyden’s committee cleared a two-year, $85 billion extension of the tax breaks, known as the EXPIRE Act, but the package stalled in May after Finance Committee Ranking Member Orrin G. Hatch, R-Utah, sought to attach a provision repealing the medical device tax, which helps fund the Democrats healthcare reform law.
Meanwhile, the House voted in June to make section 179 expensing permanent.
Since the extenders proposal was derailed on the Senate floor, supporters suggest its best hopes of passage lies in the lame duck after the election.
So with quarterly corporate taxes due today, Wyden sought to use the occasion to urge his colleagues to act.
“Today with taxes due, continuing inaction on renewing expired tax provisions is diverting business investment, driving unnecessarily higher taxes, and slowing economic growth. We cannot let this uncertainty drag on,” Wyden said.
The Finance Committee came together this spring to produce the EXPIRE Act in a cooperative, bipartisan way. It wasn’t easy, but it got done,” Wyden said. “Now is the time to revive the EXPIRE Act and renew these important tax provisions while we push ahead on comprehensive reform.”
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