http://www.washingtonpost.com/wp-dyn/content/article/2010/12/15/AR2010121504071.htmlTax-cut legislation includes $40 billion in benefits for a host of industries
By Dan Eggen
A host of industries, from Caribbean distilleries to Hollywood producers, would gain billions in tax breaks and other subsidies under compromise tax-cut legislation now moving its way through Congress. The $858 billion package approved by the Senate today is focused primarily on continuing the Bush administration tax cuts for two years, extending unemployment benefits and other large-scale expenditures. But buried inside the legislation are more than $40 billion in other giveaways and tax reductions for some of Washington's most influential industry groups.
The energy and agricultural industries, for example, would continue to receive a generous ethanol tax credit at a cost to taxpayers of about $6 billion in 2011. The 45-cents-per-gallon credit goes to fuel blenders - including large oil and gas companies such as Shell - who count it against income tax owed to the United States. U.S. technology companies such as Microsoft would continue to benefit from a tax credit for research and development carried out in the United States, costing taxpayers about $6 billion. Rum-makers in Puerto Rico and the U.S. Virgin Islands would get another two-year extension of excise tax credits for their products ($235 million), while movie and television producers would enjoy special deduction rules for U.S.-based projects ($162 million).
Owners of NASCAR tracks and other motor-sports facilities would benefit from two more years of a tax policy making it cheaper for them to fund capital projects. Estimated cost to taxpayers: $40 million. These and numerous other deals are part of a so-called "extenders" package added to the tax-cut legislation in hopes of attracting broader bipartisan support. Many of the provisions, such as the rum excise tax, are temporary fixes regularly approved by Congress every couple of years, usually by adding them to major legislation.
Steve Ellis, vice president of Taxpayers for Common Sense, a watchdog group, said many of the breaks had stalled under House rules aimed at ensuring that new spending is paid for with cuts or revenues. But the push for tax-cut legislation, he said, has "opened up the floodgates." "Most of these are sweeteners that don't get vetted or reevaluated," Ellis said. "They're just sort of on autopilot." The group is particularly critical of the ethanol provision, which has cost taxpayers more than $21 billion since 2006. The Government Accountability Office recently concluded that the credit has had little impact in encouraging ethanol use or production, especially since the government already mandates rising levels of ethanol use in gasoline and protects the corn ethanol industry through tariffs. "This tax credit is really just lining people's pockets," Ellis said. "We're not getting any kind of bang for our buck." ...
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http://online.wsj.com/article/SB10001424052748703766704576009501161973480.htmlDECEMBER 10, 2010
Companies Cling to Cash - Coffers Swell to 51-year high
Corporate America's cash pile has hit its highest level in half a century. Rather than pouring their money into building plants or hiring workers, nonfinancial companies in the U.S. were sitting on $1.93 trillion in cash and other liquid assets at the end of September, up from $1.8 trillion at the end of June, the Federal Reserve said Thursday. Cash accounted for 7.4% of the companies' total assets—the largest share since 1959.
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