(The Center Square) – West Virginia’s coal industry is worried it could face problems with the federal Inflation Reduction Act, which was just signed into law.
The Inflation Reduction Act, which was signed by President Joe Biden after narrowly making it through the House and Senate on Democratic party-line votes, will establish a 15% minimum corporate tax rate for large corporations, which will yield an estimated 7.2% hike on the coal industry. The legislation resulted from negotiations over the Build Back Better plan.
West Virginia Sen. Joe Manchin and other moderate Democrat swing votes were instrumental in the legislation’s passage. It passed the Senate 50-50 with Vice President Kamala Harris breaking the tie.
Chris Hamilton, the president of the West Virginia Coal Association, told The Center Square its members are concerned about the policies in the legislation.
“Every time we read the provisions of the IRA we find more and more provisions that concern our members,” Hamilton said. “It imposes new taxes on our industry and the turbo charging of the tax credits for renewable energy sources hurts West Virginia’s coal industry and potentially serves to put miners and plant workers out of business. This will also lead to major reliability issues associated with power supplies and household electricity due to the lack of base load generation. There is a new convoluted social justice responsibility extended to EPA which all America should be concerned over.”
Jessica Dobrinsky, a policy development associate with the free-market Cardinal Institute told The Center Square the legislation “will surely threaten jobs and communities across the state.”
“The IRA, spending billions to ‘promote clean energy,’ is the Biden Administration’s effort to halt inflation and promote its own Green New Deal,” Dobrinsky said. “The Act attempts to raise billions of dollars through various tax increases such as the 15% book minimum tax. The tax hike is expected to hit the coal industry the hardest, with an estimated increase of 7.2%. The Act will increase the tax rate on underground and surface mines by more than 50% while ‘renewable’ energy sources such as solar and wind will benefit from carve-outs and credits.”
The legislation provides an estimated $300 billion reduction in the deficit.