WASHINGTON, D.C. — President Obama outlined a new economic plan last week that includes a proposal to assist business investment, and won critical support for a small-business lending package in the Senate.
A new tax break would allow businesses to write off 100% of the cost of new capital investment, expanding upon stimulus measures that expanded business depreciation rules in 2008 and 2009.
The President said that the tax break would help small businesses equip for the future. Reaction from the small-business community was mostly positive, with some saying that the measure doesn’t go far enough.
“Allowing business to fully expense capital expenditures certainly is a plus,” Raymond J. Keating, chief economist for the Small Business Economic Council (SBEC), told Business News Daily. “Unfortunately, making it temporary is gimmicky and results in different timing of investments, not necessarily more investment.”
Separately, Sen. George Voinovich (R-Ohio) announced he will break ranks with fellow Republicans and back President Obama’s $30 billion small-business lending proposal, giving it the 60 votes required to pass without filibuster.
The legislation includes about $12 billion in tax incentives for small businesses, and establishes a $30 billion fund to encourage independent community banks to lend to small businesses.
Voinovich told the Washington Post that the “country is really hurting,” and he could no longer support Republican efforts to delay the measure. The senator has chosen not to run for re-election in his district this year.