Congress Facing New Cliff Over New Farm Bill
Even after disposing of the fiscal cliff, Congress faces another cliff in September over a new farm bill. But the New Year's deal includes several provisions farmers wanted.
Indiana Farm Bureau president Don Villwock says he's disappointed Congress still hasn't managed to pass a new farm bill, but says farmers can live with an eight-month extension. He says the impasse hasn't been partisan so much as regional -- Hoosiers would prefer to steer federal funding toward crop insurance instead of direct payments, while southern states prefer it the other way around.
The temporary deal averts a snapback to Truman-era dairy price supports that would have doubled the price of milk. Villwock says he expects Congress will try to hammer out a long-term deal over the spring and summer, though he says it's likely another round of brinkmanship will carry talks right up to the deadline again.
But Villwock says he's "thrilled" the White House dropped a push to return the federal estate tax threshold to 2001 levels. Taxes above the current $5 million threshold will rise from 35% to 40%, but Villwock says few farmers will cross that boundary. If the threshold had gone back to $1 million, the level in effect before the Bush tax cuts, he says land values would have subjected many farm families to heavy taxes.
And farmers won extension of a Bush tax break on depreciation of farm equipment, which Villwock says will help farmers modernize.