On Jan. 13, 2009, FEI’s Committee on Taxation (COT) submitted a letter to Congressional leadership outlining ten recommendations to further stimulate the economy. In brief, the FEI COT Letter to Congress recommends:
- Extend bonus depreciation and increase Section 179 expensing provisions
- Temporarily allow taxpayers to receive a refund of AMT prepayments in lieu of bonus depreciation.
- Temporarily extend the carry back period for net operating losses to five years and waive the 90 percent limitation for AMT.
- Extend the general business credit (“GBC”) carryback period from one year to five years and allow carrybacks and carryforwards to offset 100% of a taxpayer's regular tax and AMT.
- Temporary change in the treatment of capital losses.
- Multi-year extension of a strengthened Research and Development (R&D) tax credit.
- Repeal the 3% withholding requirement for government payments.
- Allow foreign subsidiaries of U.S. companies to lend or otherwise send money to the U.S. without adverse tax implications.
- Temporary relief from pension funding requirements.
- Expand tax credits for new hires or reversing layoffs.
The letter, signed by Ron Dickel, chair of FEI’s Committee on Taxation, adds:
- Although we do not believe a major overhaul of the U.S. corporate income tax structure is appropriate in the context of the economic stimulus legislation, many have noted that the U.S. corporate income tax rate is higher than the rates in all other OECD countries (save Japan, which is considering rate reductions this year). The high U.S. tax rate creates a long-term competitive disadvantage for US-based businesses. Once the stimulus legislation is enacted, we encourage Congress to lower rates and restore the US corporate tax system to a position that does not disadvantage US-based businesses in the global economy.
A similar letter was also sent by FEI COT to U.S. Treasury Assistant Secretary of Tax Policy, Eric Solomon, and U.S. Treasury Secretay-Designate Timothy Geithner, said FEI's Director of Tax and Economic Policy, Matt Miller.
The global economic crisis and issues relating to business taxation were among the FEI CEO’s List of the Top Challenges for 2009 published in Dec. 2008. The list was formulated by then-President and CEO James J. Abel. As previously announced, Marie N. Hollein became President and CEO of FEI on January 12.
In addition to FEI, other business groups providing recommendations to Congress and the administration on economic stimulus are noted in the article Business Tax Cuts Sought in U.S. Stimulus Bill, Jan. 8, 2009, by Reuters UK.
Here are some links to additional letters sent to Congress and/or the administration and transition team on this subject:
- U.S. Chamber Letter of Congress (Jan. 6, 2009)
- Equipment Finance Leasing Association (Jan. 7, 2009)
- Joint Letter (over 50 organizations, including the American Bankers Association, Business Roundtable, Financial Services Roundtable, U.S. Chamber of Commerce) (Dec. 9, 2008)
Questions regarding the FEI COT letter can be directed to Matt Miller, FEI’s Director of Tax and Economic Policy, firstname.lastname@example.org or 202-626-7804.
[Careful readers of this blog may recall I mentioned on Dec. 19 that FEI’s Director of Tax and Economic Policy was the one who ‘stole’ my Barack Obama Action Figure at the FEI Holiday Party Gift Exchange (i.e. where you can ‘steal’ something someone else picked from the gift table ahead of you, and they then can ‘steal’ from someone else or pick a new present)… but like I said then, I’m not naming any names ...☺ ]
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