National business groups generally have the same feelings about the legislation Congress passed to avoid what has been termed the “fiscal cliff.”
They’re happy that the cliff’s tax cuts were avoided in the last-minute deal, but warn that there’s still a lot of work to be done to ensure future growth.
“And, when it comes to cutting spending and controlling the national debt, this deal does not even begin to address the serious fiscal challenges we face,” U.S. Chamber of Commerce president and CEO Thomas Donahue said in a statement.
Mississippi’s two Republican Senators voted for the bill. The state’s GOP delegation in the House voted against it. Rep. Bennie Thompson, D-Bolton, voted for it.
The International Franchise Association, which advocates for business franchising, echoed the U.S. Chamber’s relief over the bill’s passage, but said overall tax reform should still be a priority.
“Failure to act could have jeopardized our industry’s growth plans and pushed the economy back into a recession,” IFA president and CEO Steve Caldeira said in a statement.
Some of the bill’s more business-friendly particulars include most of the Bush-era tax cuts becoming permanent and renewing a slew of business tax extenders. The bill makes permanent existing tax rates for single filers making less than $400,000 and for joint filers making $450,000. The bill raises rates for those above that threshold to 39.6 percent. The capital gains tax rate also rises to 20 percent.
Among the tax extenders IFA lobbied for were:
- A 50 percent bonus depreciation for qualified property bought and placed into service before Jan. 1, 2014.
- A 15-year straight-line cost recovery for qualified leasehold improvements, qualified restaurant buildings and improvements and qualified retail improvements.
- The Work Opportunity tax credit businesses receive for hiring lower-skilled workers and for those on long-term employment.
- The ability to expense capital assets like machinery under Section 179 of the IRS code, which allows for the deduction of the cost of the asset, rather than requiring the cost to be capitalized and depreciated.
Caldeira said his organization would urge Congress to immediately long-term spending, particularly related to entitlements like Medicare and Social Security, and to craft a way to reduce the U.S. debt.