Obama Proposes Business Tax Break
The Wall Street Journal reports:
President Barack Obama, in one of his most dramatic gestures to business, will propose that companies be allowed to more quickly write off 100% of their new investment in plants and equipment through 2011.
The proposal, to be laid out Wednesday in a speech in Cleveland, tops a raft of announcements, from a proposed expansion of the research and experimentation tax credit to $50 billion in additional spending on roads, railways and runways.
Companies can now deduct new investment expenses, but over a longer period of time—three to 20 years. The proposed change, which would let companies keep more cash now, is meant to give companies who may be hesitant to invest an incentive to expand, acting as a spur to the overall economy.
While some economists praised the investment-incentive idea, some business groups and congressional Republicans said their higher priority remained an extension of the Bush income-tax rates for higher earners that are set to expire at the end of 2010. Mr. Obama and many congressional Democrats want to let those breaks expire.
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