Internecine business feud over tax extenders
Businesses aren't sure what to make of the tax extenders bill, which offers some goodies like research and development tax credits but also limits some tax credits multinationals can claim on foreign profits. There are also higher taxes for private equity firms and venture capitalists. All in all, a mixed bag for big business.
Companies are starting to pick sides, though. A group of them -- including American Express, General Electric, Bank of America and Hewlett-Packard -- sent a letter Monday to Senate Majority Leader Harry M. Reid (D-Nev.) and Senate Minority Leader Mitch McConnell (R-Ky.) saying they still want lawmakers to pass the extenders bill. On the opposite side, there's IBM and the private equity industry, which oppose the bill for the tax hikes it contains.
Of course, the story gets more complicated because Democrats are scrambling to find ways to pay for programs -- and they want to use the the very tax hikes on multinationals in the extenders bill to help pay for yet another bill that funds state Medicaid programs. If this Medicaid bill passes in its current form (still doubtful) it could shift the balance in the extenders fight. Presumably, an extenders bill without higher taxes on multinationals would only strengthen support from companies like GE -- and maybe persuade IBM to come on board.
Jia Lynn Yang
August 3, 2010; 5:58 PM ET
Categories: Corporate taxes
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