Forcing American businesses to defend all tax expenditures from the pejorative label of “tax preference” is a mistake. It places an undue burden on America’s job creators. Investments can and should be quickly expensed to ensure that the time value of money isn’t lost. Productive investment should be encouraged, not discouraged, by tax reform in the midst of America’s slow and sputtering recovery.
Hatch and Baucus, along with Treasury officials and other leaders in Washington, need to reverse the way they think about business tax preferences. True business tax reform will spark the economy and create jobs. Increasing the corporate tax burden on American businesses will only discourage investment, reduce government revenue and stifle job creation. America desperately needs tax reform, but it must be done right.
Gary Clyde Hufbauer is the Reginald Jones senior fellow of the Peterson Institute for International Economics.
Vice President Joe Biden waits to conduct a mock swearing-in ceremony with Sen. Brian Schatz, D-Hawaii, in the Capitol's Old Senate Chamber, December 2, 2014. Schatz was sworn in to serve the remainder of his term since he was appointed to the seat after Sen. Daniel Inouye, D-Hawaii, passed away.