The Economic Effects of Bonus Depreciation
May 28, 2014
The House Ways and Means Committee will markup a permanent extension of bonus depreciation on Thursday. Permanently extending bonus depreciation would spur investment, lift wages, grow the economy, and increase federal revenue.
- Growth: Bonus depreciation would grow the economy by 1 percent: This would add $182 billion to the economy.
- Investment and Wages: Bonus depreciation would increase investment and wages: Permanently extending bonus depreciation would increase the capital stock by over 3 percent and increase wages by about 1 percent by lowering the current cost of investment.
- Jobs: Bonus depreciation would create 212,000 jobs.
- Revenue: Static revenue estimates are misleading. Bonus depreciation would increase federal revenue by about $23 billion a year in the long run, due to increased economic activity.
Update: More on Bonus Depreciation:
The Economics of Bonus Depreciation:
- The Economic and Budgetary Effects of Bonus Expensing
- The Economic Effects of Bonus Depreciation
- Permanently Extending Bonus Depreciation Grows the Economy
Bonus Depreciation, Investment and Growth:
- Bring Back Bonus Expensing, Bring Back Jobs
- Top 10 Things to Know about Investment and Tax Policy
- Investment, GDP Slow in First Quarter: Bad Weather or Bad Tax Policy
- The Economic and Budgetary Effects of Full Expensing of Investment
- Slow Economic Growth Does Not Need to Be the New Normal
History of Bonus Expensing: