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Thursday, June 20, 2024

Corporate ‘Tax Reform:’ Rich Get Richer While Taxpayers Get Screwed

Congress handed out tax breaks to the rich and powerful this week, sending President Bush a so-called “corporate tax reform bill” that is nothing more than a welfare program for big business.

Congress handed out tax breaks to the rich and powerful this week, sending President Bush a so-called “corporate tax reform bill” that is nothing more than a welfare program for big business.

Included in the 650 pages of doubletalk are $140 billion in tax breaks for 276 large companies and special interest groups: Starbucks, NASCAR, Carnival Cruise Lines, shipbuilders, and Home Depot.

“This is the worst example of the influence of special interests that I have ever seen,” says Arizona Senator John McCain.

You got that right John-Boy. This bill, which President Bush has promised to sign, is loaded with so much pork it should scream “oink, oink” and belly up to the trough. It stands, unabashed, as the latest example of how special interests control our government and proves, once-again, that the liars who control Congress (and who promised to cut the pork from such legislation) has bung holed the American public once again without even the courtesy of a reach-around.

What’s included in this gift to the fat cats? A little bit of everything, including a $44 million tax break for importing ceiling fans, a $27 million tax break for horse and dog racing establishments, $9 million for the archery industry, $11 million for manufacturers of tackle boxes, and a big write off for NASCAR track owners.

A few specifics:

  • Ceiling Fans: Suspends a $4.7% duty on ceiling fans, which Home Depot is one of the main beneficiaries. This is for any ceiling fans purchased before 12/31/2006. Cost: $44 million.
  • Shopping Malls: $231 million in taxpayer funds to finance $2 billion in bonds for four “Green Bond” mall developments – Destiny, USA in Syracuse, New York; Riverwalk in Shreveport, LA; Belmar in Lakewood, CO and Atlantic Station in Atlanta, GA.
  • Dog and Horse Race Tracks: A $27 million provision included to lure more foreigners to gamble at U.S. horse and dog racing establishments. The National Thoroughbred Racing Association has advocated that the United States should eliminate a 30 percent tax for foreigners who bet on American horse races.
  • Shipbuilders: A $495 million provision championed by Sens. John Breaux (D-LA) and Olympia Snowe (R-ME) allows shipbuilders such as Northrop Grumman to use a different accounting technique, which allows for enhanced tax treatment.
  • Cruise Ships: Sens. Lisa Murkowski and Bob Graham added a $28 million provision providing the cruise industry a delay until after September 24, 2004 in paying taxes on the airplane tickets, hotels, and other excursions it sells in the United States. The tax delay would save Carnival Corp $15 million and Royal Caribbean would save $8 million to $10 million.
  • Fishing Tackle Boxes: Reduces the excise tax on fishing tackle boxes to 3% from 10%. One of the biggest beneficiaries will be Plano Molding Co. of Illinois. The company, headquartered in House Speaker Dennis Hastert’s district, has been making plastic fishing-tackle boxes for more than 55 years. A strong supporter of this provision is Rep. Jerry Weller (R-IL) a Ways and Means Committee member. Plano has three plants in Weller’s district, and employs hundreds of workers. Cost: $11 million.
  • NASCAR: Sen. Jon Kyl (R-AZ) is the champion of this $101 million provision, which allows track owners to write off the cost of grandstand facilities over seven years – the only such tax break for owners of a sports facility.
  • Trial Lawyers: This whopping $327 million tax break establishes costs incurred as a result of attorney and court costs paid to prosecute a claim of unlawful discrimination as a tax deduction.
  • Hollywood: A $336 million windfall that allows studios to expense up to $15 million in the first year of production of small and independent films in the United States. Studios could expense an additional $5 million if a significant amount of production expenditures are incurred in low-income communities or in the Delta Regional Authority. The Delta Regional Authority includes counties in Alabama, Arkansas, Illinois, Kentucky, Louisiana, Mississippi, Missouri and Tennessee. Hollywood also benefits from the new manufacturing tax break.

The list seems to go on forever: $247 million break for manufacturers of corporate and private jets on top of a $995 million break for companies that lease planes; $501 million break for railroads and even a $9 million break for archery companies.

“The sad part is that Congress missed a golden opportunity here; they could have used this legislation to address the nation’s fiscal woes by finding new revenues to lower the deficit,” says a press release from the Taxpayers for Common Sense.  “Instead, this legislation will blow a crater-sized hole in the federal budget.”

Congress doesn’t care about golden opportunities. All our 535 elected representatives and senators care about is the golden rule: He who has the gold makes the rules. When the fat cats who write the big political action committee checks say “gimmie,” the Congress they bought is only too happy to comply and, in the process, tell the rest of us to drop our pants, bend over and take it in the ass.