WASHINGTON — The latest version of the U.S. Senate's sweeping tax bill proposal includes a set of long-sought tax breaks for victims of the devastating 2016 Baton Rouge-area flood.
The tax-relief measures would allow flood victims to deduct property losses from their taxes and waive a tax penalty for those who tapped retirement accounts in the wake of the disaster, which followed record-breaking rainfall that hit the area beginning on Aug. 11, 2016.
Sen. Bill Cassidy, a Louisiana Republican and member of the Senate Finance Committee, which is handling the tax bill, submitted the provisions as an amendment during the committee's lengthy hearings on the bill.
The committee's influential chairman, Republican Sen. Orrin Hatch, of Utah, included it in a revised version of the Senate GOP bill released Tuesday night.
The tax-relief measures would save those hit by the August 2016 flood a total of about $200 million, according to the congressional Joint Committee on Taxation's analysis of the latest Senate draft bill.
"This amendment will deliver vital tax relief to tens of thousands of Louisiana families hurt by last year’s devastating flood," Cassidy said.
"This is a huge help for the people of our state, and I thank Chairman Hatch for agreeing to include my amendment in the bill."
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The inclusion of disaster tax relief in Hatch's latest draft — known as a "chairman's mark" — doesn't ensure it'll make it into law. A separate tax bill drafted by House Republicans doesn't include the provisions and significant revisions are possible as GOP leaders on Capitol Hill attempt to reconcile major differences between the two chambers while maintaining enough votes in each to pass.
Sen. John Kennedy, the state's junior member of the U.S. Senate, welcomes the move. The Republican doesn't sit on the finance committee but said he's pleased with the latest revisions to the bill.
"I think it's a great idea," Kennedy said.
Louisiana's congressional delegation has fought for similar disaster tax-relief provisions for more than a year with little luck.
Cassidy and former Republican Sen. David Vitter pushed a bill shortly after the flood that would've allowed flood victims to tap retirement funds without penalties.
U.S. Rep. Garret Graves, R-Baton Rouge, and former Rep. Charles Boustany, R-Lafayette, also introduced disaster tax relief bills that would've made it easier to write off disaster losses.
None of those bills came close to passing into law. Both Graves' and Boustany's proposals died in the House Ways and Means Committee, a panel that has no Louisiana members and holds sway over tax decisions.
Several Louisiana lawmakers were furious when their colleagues in September promptly passed a raft of tax-relief measures for those hit by a series of hurricanes in 2017 — but left out any provisions for victims of last year's Louisiana floods.
"This is absurd, it is absolutely absurd," Graves told his House colleagues during floor debate on that tax bill, which was tacked onto a bill funding the Federal Aviation Administration.
Graves on Wednesday welcomed the changes to the Senate bill, calling tax-relief for Louisiana flood victims “a matter of fairness” and a needed boost for the area’s recovery.
Both he and others in the Louisiana delegation have met with House Speaker Paul Ryan, R-Wisconsin, about including tax relief and other 2016 flood recovery measures in the next anticipated disaster recovery package, which is expected to also include billions of dollars in recovery money for Gulf Coast states and U.S. territories in the Caribbean devastated by this year’s hurricanes.
“Any vehicle to get this done is fantastic,” Graves said. “We’re going to keep working a multi-prong strategy here (in Congress) to get this done.”