A recent report by the National Conference of State Legislatures (NCSL) examining state tax actions in 2013 found that “collective revenue actions taken by the 50 states resulted in a slight net tax cut of less than $1...
- The Tax Policy Blog
- Are the Good Durable Goods Orders As Good As They Appear?
Are the Good Durable Goods Orders As Good As They Appear?
‘Tis the night before Christmas, and economists and the stock markets are rejoicing in the gift of an unexpected jump in durable goods orders in November. Some market analysts are declaring it to be a harbinger of a strengthening economy in 2014. One can always hope.
However, before anyone gets too carried away, it would be wise to note that some of these November orders may be due to a pending tax increase. The last extension of “bonus expensing” in the American Taxpayer Relief Act of 2012 – which allows immediate write-off of 50% of the cost of equipment – will expire on December 31. The cost of new equipment will be several percent higher in 2014.
The current surge in orders could be part of a rush to get machinery in place in offices and on factory floors by the end of the year to qualify for the faster write-off. The surge may be followed by a dip in investment this winter.
Stephen J. Entin, Senior Grinch
Buy this blogger a cup of coffee!
Join the Tax Foundation's fight for sound tax policy Go
About the Tax Policy Blog
The Tax Policy Blog is the official weblog of the Tax Foundation, a non-partisan, non-profit research organization that has monitored tax policy at the federal, state and local levels since 1937. Our economists welcome your feedback. If you would like to send an e-mail to the author of a blog post, please click on that person's name to locate his or her e-mail address or visit our staff page here.