ABC to Bush: Let Firms Expense Investments

ByJohn S. McClenahen The political chances of it happening anytime soon are slim at best. But the Washington-based American Business Conference (ABC), a group of midsized, high-growth manufacturing and service businesses, is floating the idea with President Bush of letting companies expense their investments in new equipment, worker training, and education. In contrast to depreciation, expensing would allow companies to write off the costs of productivity-enhancing investments in the year they occurred. And "there is a strong case to be made for scrapping the corporate income tax entirely and finding a simpler, fairer, and more understandable means of raising the revenue thus foregone," ABC also is telling Bush. Realizing that it, too, would be politically difficult to pull off, the business group is urging Bush as an interim step to consider backing legislation allowing business to accelerate the pace at which they recover the costs of investments in machines and people.