Just in case you are feeling all giddy about Congress reaching an agreement and helping to save you $30/week keep in mind who really benefits from the Congressional panic sessions.
Minds far sharper than mine have torn through the draft legislation and found these 8 giveaways....from Matt Stoller -
NASCAR Bailout - Sec 312 extends the “seven year recovery period for motorsports entertainment complex property” build a racetrack and get tax breaks on it. This one was projected to cost $43 million over two years.
Railroads maintenance - Sec. 306 provides tax credits to certain railroads for maintaining their tracks. Tax credits for doing something they should be doing anyway? Juicy. This is worth roughly $165 million a year.
Disney’s Gotta Eat - Sec. 317 is “Extension of special expensing rules for certain film and television productions”. It’s a relatively straightforward subsidy to Hollywood studios, and according to the Joint Tax Committee, was projected to cost $150m for 2010 and 2011.
Help a brother mining company out – Sec. 307 and Sec. 316 offer tax incentives for miners to buy safety equipment and train their employees on mine safety. Taxpayers shouldn’t have to bribe mining companies to not kill their workers.
Subsidies for Goldman Sachs Headquarters – Sec. 328 extends “tax exempt financing for York Liberty Zone,” which was a program to provide post-9/11 recovery funds. According to David Cay Johnston’s The Fine Print, Goldman got $1.6 billion in tax free financing for its new massive headquarters through Liberty Bonds.
$9B Off-shore financing loophole for banks – Sec. 322 is an “Extension of the Active Financing Exception to Subpart F.” This allows American corporations such as banks and manufactures to engage in certain lending practices and not pay taxes on income earned from it. According to this Washington Post piece, supporters of the section include GE, Caterpillar, and JP Morgan.
Tax credits for foreign subsidiaries – Sec. 323 is an extension of the “Look-through treatment of payments between related CFCs under foreign personal holding company income rules.” It’s a provision that allows US multinationals to not pay taxes on income earned by companies they own abroad.
Bonus Depreciation, R&D Tax Credit – These are well-known corporate boondoggles. The research tax credit was projected to cost $8B for 2010 and 2011, and the depreciation provisions were projected to cost about $110B for those two years, with some of that made up in later years.