100 Percent Bonus Depreciation (Full Expensing)

State Tax Reform and Relief Trend Continues in 2023

R&D Amortization Hurts Economic Growth, Growth Industries, and Small Businesses

The current tax treatment of R&D expenses is irrational, complicated, and counterproductive. Fortunately, fixing this problem is a bipartisan issue.

Expensing of Machinery and Equipment Should Be Made Permanent

Making expensing permanent is especially important now, when the economy is threatened with a recession and inflation remains high.

Testimony: The Role of Corporate Taxation in the European Union’s Future Tax Policy Mix

As policymakers shift their focus away from tax rates and look to harmonize the EU’s corporate tax base, they should understand the benefits of full expensing.

New Jersey Should Take Opportunity to Make Corporate Taxes More Competitive

By letting the corporate surtax expire, eliminating taxes on GILTI, and embracing full expensing, New Jersey would take important steps toward creating a more welcoming and competitive tax environment.

Inflation Reduction Act’s Price Controls Are Deterring New Drug Development

As predicted, the Inflation Reduction Act’s misguided price-setting policy is already discouraging drug development. Rather than double down on it, as President Biden proposes doing in his budget, lawmakers ought to restore incentives to invest in the United States.

What Biden’s Budget Gets Wrong about Expensing for Intangible Drilling Costs

Consistent principles ought to apply across the tax code. In the case of intangible drilling costs, companies should be able to claim full deductions for the costs they incur.

Temporary Full Expensing Arrives in the UK

The UK’s adoption of full expensing is a welcome step that may generate short-run economic benefits. However, for the reform to have a meaningful effect on the UK’s international competitiveness and long-run economic performance, it must be made permanent—which the British government has said it hopes to do.

Taxing Distributed Profits Makes Business Taxation Simple and Efficient

Adopting a distributed profits tax would greatly simplify U.S. business taxes, reduce marginal tax rates on investment, and renew our country’s commitment to pro-growth tax policy.

Tennessee Looking Toward Pro-Growth Change in 2023

With other states upping their game to attract ever-more-mobile people and businesses, lawmakers and the governor are not content to leave Tennessee’s business taxes in their current, uncompetitive form.

State Tax Policy as an Inflation Response

At the end of 2022, prices were 14.6 percent higher than they were two years prior. That’s the fastest inflation rate over any two calendar years since the stagflation era of the late 1970s. State policymakers are understandably interested in bringing any tools at their disposal to bear on the problem. And many of them are reaching for tax policy solutions.

Bonus Depreciation and New Corporate Investment in 2018

If bonus depreciation is allowed to phase out, then the tax bias against capital investments will increase, discouraging firms from making otherwise profitable investments.

Return to R&D Expensing Crucial for Manufacturing and Technology Investment

The tax treatment of research and development (R&D) expenses is one of the biggest issues facing Congress as the year winds down.

States Should Make Full Expensing Permanent to Help Curb Inflation

In times of high inflation, states should consider adopting permanent full expensing because it boosts long-run productivity, economic output, and wages.

Shaky Economic and Fiscal Outlook Requires Stable and Pro-Growth Tax Extenders Policy

Policymakers face a difficult balancing act this year in what is likely to be an unusual tax extenders season.

Details and Analysis of Canceling the Scheduled Business Tax Increases in Tax Cuts and Jobs Act

The business tax changes originally introduced in the TCJA are scheduled to increase tax burdens on businesses at a time when economic headwinds and broader uncertainty are higher than they have been in decades.

Permanent 100 Percent Bonus Depreciation Even More Important When Inflation Is Elevated

We find that the dynamic cost of permanent bonus depreciation rises by about 7 percent under 4 percent inflation, but the economic benefit, measured by the size of the economy, rises by about 25 percent.

After the UK Super-Deduction: Assessing Proposals for the Reform of Capital Allowances

For many years, the UK has adopted a strikingly ungenerous approach to capital cost recovery – the ability of firms to write off investment against tax. This has coincided with consistently low levels of business investment. The super-deduction, which has temporarily made the UK tax system much more supportive of capital investment in plant and machinery is set to expire.

The Economic, Revenue, and Distributional Effects of Permanent 100 Percent Bonus Depreciation

The phaseout of 100 percent bonus depreciation, scheduled to take place after the end of 2022, will increase the after-tax cost of investment in the U.S. Permanently extending it would increase long-run economic output by 0.4 percent and increase employment by 73,000 FTE jobs.

New Research Shows Positive Long-Run Effects from Corporate Tax Cuts

Policymakers should continue to focus on longer term impacts rather than emphasizing the short-term stimulus effects of tax cuts.