America’s Small Business Tax Relief Act of 2015–H.R.636
Rep. Reed is a co-sponsor of H.R. 636. Tom writes:
Providing tax certainty is only fair to our small businesses and farmers. As the main source of jobs we should ensure every effort to encourage their growth and expansion. We need to take common sense steps to give our job creators more certainty and more control over their own financial situation. Southern Tier and Finger Lakes small businesses and farmers need to know the tax landscape in advance so that they can make investments in equipment and employees. I am proud to support this bill and our local Upstate small businesses and farmers.
Tom doesn’t mention that this bill would make a temporary tax break for business permanent. Tom sometime opposes making temporary measures permanent, but only those he dislikes. The provision made permanent (Section 179 of the tax code) is also known as “bonus depreciation,” a bonus for businesses; Tom doesn’t mention that.
Here is the CRS summary:
(Sec. 2) This bill makes permanent after 2014 the $500,000 allowance for the expensing of depreciable business property (section 179 property) and the $2 million threshold after which the amount of such allowance is reduced. Both the allowance and the threshold amount are indexed for inflation for taxable years beginning after 2015. The allowance is also made permanent for computer software and qualified real property (i.e., qualified leasehold improvement property, restaurant property, and retail improvement property). The exclusion of air conditioning and heating units from the definition of section 179 property is eliminated.
Tom doesn’t mention the cost to the treasury:
The staff of the Joint Committee on Taxation (JCT) estimates that enacting H.R. 636 would reduce revenues, thus increasing federal deficits, by about $77 billion over the 2015-2025 period.
Because H.R. 636 benefits businesses while doing nothing for individual taxpayers, President Obama has threatened a veto.
Tom wraps this bill in misleading language:
- tax certainty
- fair to our small businesses and farmers
- encourage their growth and expansion
- common sense steps
- job creators more certainty and more control over their own financial situation.
- Southern Tier and Finger Lakes small businesses and farmers
Tom doesn’t mention that the cost of this bill isn’t offset, that it is tax welfare for businesses everywhere large and small, that it does nothing for individual taxpayers, and that the expectation that tax breaks for business “encourage growth and expansion” is unjustified.
© William Hungerford – February 2015