President Obama will ask Congress for tax breaks to allow businesses to write off new capital investments through 2011, the Associated Press reported Tuesday.
The move to allow 100% write-off of such deductions is the latest in a series of proposals the White House is rolling out in hopes of showing action on the economy in advance of November’s mid-term elections, AP reported.
The breaks would save businesses $200 billion over two years, allowing companies to have more cash on hand, AP said. Obama will outline the plan Wednesday in Cleveland.
The administration separately is seeking a $50 billion “infrastructure bank” to fund new road, bridge, rail and other infrastructure projects. (Click here for related story.)
Stimulus measures passed in the last two years allowed businesses to depreciate 50% of their capital investments, and a separate small business bill the White House is urging the Senate to pass would extend that tax break through the end of this year, AP reported.
An administration official told AP the cost to taxpayers over 10 years would be an estimated $30 billion, with most of the money lost in tax revenue being recouped as the economy strengthens.
