Senate Gives Leasing a Punch in the Face

 

"Since we're giving tax relief to companies and small businesses, it's only fair that we tighten the law for those avoiding their fair share,'' said Senate Finance Committee Chairman Charles Grassley, R-Iowa.

 

One of the biggest changes raises $39 billion by blocking companies from generating immediate tax deductions by leasing and writing off the depreciated value of foreign and domestic public works, such as bridges, buses and trains.  This was strongly opposed by the

Equipment Leasing Association as well as many cities, counties, and

states who's budget will be drastically affected, as well as funders

of such leasing arrangement

 

Taking the lead and urging the US Congress to approve its version,

which they believe will end the growing costs of tarrifs, the senate

voted 92-5, sending a solid message of unity.

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The tariffs, imposed by the European Union, retaliate against the United States for failing to rid a domestic tax break that has had

the leasing industry and others quite concerned since late last

year.  The Senate bill goes beyond a simple fix to end the trade dispute.

 

In addition to its affect on equipment leasing, it also included: a $14 billion in energy production incentives, a pile of expiring tax credits and a short-term tax break meant to encourage companies to bring home income accumulating abroad.

 

At its core, the Senate bill is aimed at cutting taxes for American manufacturers, rewarding most to those companies that produce their goods at home. The entire package cuts taxes $170 billion over a decade, including some new and old tax cuts.

 

Lawmakers cover the cost of the package with money recouped from the repealed tax break for exporters and an assault on corporate tax shelters and loopholes.

 

The bill also would adjust tax rules for multinational corporations.

 

Senators voted 74-23 to keep those new tax rules, which Senate tax-writers said reduced double taxation of companies that operate in the United States and abroad.

 

For a background on this tax legislation, please go to: