By Patricia Zengerle
WASHINGTON (Reuters) – The U.S. Senate voted overwhelmingly on Wednesday to advance a tax treaty with Chile, paving the way for final approval of a pact seen as crucial for ensuring access for U.S. companies to lithium, a mineral essential for electric vehicle batteries.
The agreement cleared a Senate procedural hurdle by 97-2, comfortably over the two-thirds supermajority required to approve treaties in the 100-member chamber.
Business interests have been pushing for the tax agreement for years. The U.S. Chamber of Commerce called it an urgent priority. Without it, taxes on U.S. companies with Chilean operations could climb to more than 44%, the business group said.
There was no immediate indication of when the Senate would have a final vote. Lawmakers are due to leave Washington later this week for a two-week Independence Day recess.
Final approval would send the treaty to the White House, where President Joe Biden must sign the papers necessary for ratification.
Chile’s Congress approved the treaty in 2015.
U.S. companies have a strong presence in mining, finance and other industries in Chile. In urging approval, the Senate’s Democratic majority leader, Chuck Schumer, said the treaty was crucial to ensuring continued U.S. access to lithium.
Chile announced a plan to expand lithium mining in the country in April in an attempt to regain its position as the world’s top lithium producer.
Backers of the agreement also said its failure could hobble the U.S. transition to clean energy.
(Reporting by Patricia Zengerle; Editing by Alistair Bell)