Senate may look at House's farm bill
The chairman of the Senate Agriculture Committee, Iowa Democrat Tom Harkin, said Tuesday he supported the tax on foreign corporations that the Democrat-controlled House attached to its version of the farm bill. The tax would raise an estimated $4 billion during the next five years.
"We're looking at doing basically the same thing over here," Harkin said. The tax "would give us some needed resources."
Harkin is likely to run into opposition in the Senate similar to what the proposal encountered in the House.
Iowa Sen. Charles Grassley, the top Republican on the tax-writing Finance Committee, said Tuesday that the corporate tax "violates some of our international treaties that we have with other countries."
House Democrats said that the measure targeted corporations that were routing revenue from their U.S. operations through other countries to avoid paying U.S. taxes.
Republicans and business groups argued that the measure would discourage foreign investment in the United States.
The tax allowed lawmakers to increase food stamp benefits without cutting farm programs.
The Bush administration cited that tax and other issues in threatening to veto the five-year House bill.
Harkin said that he also backed the House plan to tap royalties on offshore oil leases as well as profits of companies and agents that sell federally subsidized crop insurance.
The House bill would use the oil royalties to pay for $2.4 billion in energy programs, including loan guarantees for companies that want to make fuel ethanol from crop residue, wood chips and other sources of plant cellulose.
Revenue from the crop insurance industry was earmarked in the House farm bill for international food aid.
Harkin is dropping the idea of reducing the $5.2 billion in annual fixed payments that go to grain and cotton farmers.
"There is just not the support for that in the committee," Harkin said.
The fixed payments that go to Iowa farmers and landowners total about $500 million a year.
Harkin also reiterated his plan to expand the Conservation Security Program, which provides payments to farmers who follow practices that reduce erosion and improve wildlife habitat.
Under the House bill, no additional farmers would be allowed to enroll in the program until 2012.
Harkin wants to expand the program to cover 80 million acres nationwide. About 15.3 million acres are enrolled in the program, including 909,968 in Iowa.
Harkin's committee plans to write its version of the farm bill in September.
