Broun: "We have to enact policies that stimulate small businesses."
Congressman Paul Broun today cosponsored the "Economic Growth Act of 2008." This legislation is offered in response to concerns that current economic policies are not sufficiently tailored to meet the needs of America's economy. The bill introduced today is specifically designed to stimulate the economy by freeing up resources small business can use for job creation.
"Frankly, I don't think that sending a check for $500 to every family is going to stimulate the economy," said Broun. "We've got to focus on creating jobs. A real stimulus plan has to be geared towards small businesses. Small business is the economic engine of our country. We have to enact policies, such as those contained within the Economic Growth Act of 2008,' that encourage small businesses to expand."
The "Economic Growth Act of 2008" contains the following provisions:
· Full, Immediate Expensing. The bill would allow all businesses to immediately expenseor fully deduct on their tax returnsthe costs of assets (including buildings) they purchase for their business in the year that they buy such assets ("Section 179" expensing). Under current law, businesses can only take limited deductions in pieces, over several years. By uncapping and accelerating the expensing, this provision would encourage the purchase of assets with which to grow a business.
· Significant Reduction in the Top Corporate Tax Rate. The bill would immediately cut the top corporate income tax rate from 35% to 25%, aligning it with the average rate in the European Union. By allowing businesses to keep more of the money they earn, this provision would encourage the expansion of businesses, the hiring of more workers, and an acceleration of investment, while making American companies more competitive internationally.
· End the Capital Gains Tax on Inflation. The bill would index for inflation the cost basis used when calculating the capital gains tax on assets acquired before the end of 2008. Under current law, the capital gains tax is based on the difference in the original purchase price of the asset and the sale price of the asset. However, some of this difference, or "gain," can be attributed to inflation. By effectively reducing the amount of a gain that is taxable, this provision would encourage the movement of capital in 2008 and spur voluminous economic investment.
Simplify the Capital Gains Rate Structure. The bill would allow corporations to benefit from the 15% capital gains rate. Under current law, individuals pay a top capital gains rate of 15%, but corporations are subject to a 35% top rate. By encouraging corporations to sell unwanted assets, this provision would unleash funds and materials with which to create jobs and grow the economy.