House Panel OKs Extension for Tax Credit

Federal solar tax credits, slated to expire at the end of this year, are the subject of action in the House of Representatives that, with the concurrence of the Senate and the signature of the President, could mean a gradual phase-out rather than sudden death.

By a 9-3 vote, the House Ways and Means Committee has passed a three-year extension that would continue residential credits (currently 40%) at the 30% level through 1986 and at 20% for each of the two following years.

Business credits, now 15%, would remain at that level through 1986, drop to 12% in 1987 and to 8% in 1988. At the end of the three years, in both cases, the subject will be approached again.

The House legislation, originally H R 1272, introduced by Rep. Wyche Fowler (D-Ga.) and co-sponsored by 15 of the committee’s 36 members, has been made part of the major tax reform legislation being written by the committee.

Those concerned are confident of its passage by the full House, according to a spokesman for the national Solar Energy Industries Assn. in Washington.

However, the Senate is not expected to have time to act on it by the end of the year. The industry spokesman said an agreement has been reached for the Senate to extend the credits at 30% for six months to a year to give itself time to do so, and that Sen. Bob Packwood (R-Ore.), Finance Committee chairman, has agreed to support such a measure.

The new legislation will affirm that solar greenhouses are not eligible for tax credits--a question left murky by current interpretations of the statutes--and that swimming pools, not eligible now, still will be ineligible.