New Dogfight Between Obama and Private Jet Industry
WEALTH, MILLIONAIRES, BILLIONAIRES, INSIDE WEALTH: TAXES, BUSINESS NEWS
By:Robert Frank | CNBC Reporter & Editor
CNBC.com | Wednesday, 6 Feb 2013 | 1:52 PM ET
The president is taking aim again at private jets.
As part of the debt talks with Congress aimed at closing tax loopholes, Barack Obama is calling again for eliminating what he calls "tax breaks for private jet owners." The message recalls Obama's 2011 crusade in which he told Americans, "I think it's only fair to ask an oil company or a corporate jet owner that's doing so well to give up that tax break. I don't think that's real radical."
The private jet industry disagrees. In a statement, the National Business Aviation Administration said the industry employs 1.2 million Americans and generates $150 billion in economic activity. Closing the loophole, they said, would "not yield meaningful progress" in the debt efforts.
The tax break Obama is targeting relates to the accelerated depreciation of jets used for business purposes. Current tax law allows companies to write off the cost of their planes over five years, rather than the seven years allowed for charter and commercial planes.
"The White House's rhetoric about general aviation depreciation ignores established facts and long-standing tax policies related to business airplane ownership and use, does almost nothing to seriously address the nation's debt, and has the potential to harm a great American industry in the process," NBAA President Ed Bolen said in a statement.
The NBAA added that the private-jet business is still struggling after the crisis and could take "several years" to recover.
Studies show that closing the loophole would only generate about $3 billion over 10 years.
Senate Minority Leader Mitch McConnell called the corporate-jet proposal "a cheap stunt and it certainly won't shrink the deficit or increase jobs." Others point out that Obama is attacking private-jet owners while himself enjoying the ultimate private jet – Air Force One.
© 2013 CNBC.com
URL: http://www.cnbc.com/100439712
WEALTH, MILLIONAIRES, BILLIONAIRES, INSIDE WEALTH: TAXES, BUSINESS NEWS
By:Robert Frank | CNBC Reporter & Editor
CNBC.com | Wednesday, 6 Feb 2013 | 1:52 PM ET
The president is taking aim again at private jets.
As part of the debt talks with Congress aimed at closing tax loopholes, Barack Obama is calling again for eliminating what he calls "tax breaks for private jet owners." The message recalls Obama's 2011 crusade in which he told Americans, "I think it's only fair to ask an oil company or a corporate jet owner that's doing so well to give up that tax break. I don't think that's real radical."
The private jet industry disagrees. In a statement, the National Business Aviation Administration said the industry employs 1.2 million Americans and generates $150 billion in economic activity. Closing the loophole, they said, would "not yield meaningful progress" in the debt efforts.
The tax break Obama is targeting relates to the accelerated depreciation of jets used for business purposes. Current tax law allows companies to write off the cost of their planes over five years, rather than the seven years allowed for charter and commercial planes.
"The White House's rhetoric about general aviation depreciation ignores established facts and long-standing tax policies related to business airplane ownership and use, does almost nothing to seriously address the nation's debt, and has the potential to harm a great American industry in the process," NBAA President Ed Bolen said in a statement.
The NBAA added that the private-jet business is still struggling after the crisis and could take "several years" to recover.
Studies show that closing the loophole would only generate about $3 billion over 10 years.
Senate Minority Leader Mitch McConnell called the corporate-jet proposal "a cheap stunt and it certainly won't shrink the deficit or increase jobs." Others point out that Obama is attacking private-jet owners while himself enjoying the ultimate private jet – Air Force One.
© 2013 CNBC.com
URL: http://www.cnbc.com/100439712
