Biden admin offers tax breaks for higher green energy worker pay
TL/DR –
The US Treasury Department has announced that employers in the renewable energy sector who pay the prevailing wage will be eligible for a fivefold increase in available tax credit under the final rules of the Inflation Reduction Act. The majority of these renewable energy projects are based in areas where the median household income falls below the national average. The Biden administration is promoting this as part of a broader strategy to create jobs within the renewable energy sector, in contrast to Republican claims that these initiatives cost jobs.
The Treasury Department Announces Increased Tax Credits under the Inflation Reduction Act
The Treasury Department has finalized rules for prevailing wage and registered apprenticeships (PWA) under the Inflation Reduction Act (IRA). Renewable energy sector employers who qualify will now access an increased tax credit, five times the previous rate.
The increase is contingent upon paying the prevailing wage – the average wage for a given field and area. A significant proportion of IRA renewable energy projects are in counties with lower than average household incomes, according to the Treasury Department’s analysis.
Acting Labor Secretary Julie Su, commented, “These tax breaks will deliver tangible benefits to workers across the country. The administration is committed to ensuring that workers partake in the prosperity of a clean energy future through fair wages and training opportunities.”
The Biden administration views renewable jobs and efforts to battle climate change as job creators, which counters Republican claims of job loss in the energy sector. Shawn Fain, United Auto Workers President, echoed this sentiment, emphasizing that the transition to renewables does not mean sacrificing union jobs.
Senate Finance Chair Ron Wyden (D-Ore.), a known climate advocate, applauded the final rules, emphasizing their importance in the upcoming 2024 election. He dismissed claims of the climate change fight hurting American workers as a fabrication by Republicans and their oil industry donors.
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