Ford Focus Forum banner

1 - 19 of 19 Posts

·
Registered
Joined
·
2,957 Posts
Discussion Starter #1
SUV tax break to hit $100,000

Small-business gain has been $25,000

May 23, 2003

BY RUBY L. BAILEY
FREE PRESS WASHINGTON STAFF

WASHINGTON -- A loophole that allows small-business owners to deduct $25,000 for luxury sport-utility vehicles will grow to $100,000 under the $350-billion stimulus plan expected to be approved by the Senate today and signed by President George W. Bush on Monday.

The tax break applies to small businesses -- and to individuals who have set up mini-corporations for tax purposes -- when they purchase a vehicle weighing at least 6,000 pounds.

The provision was created in 1996 to prevent farmers and others from being penalized by the 10-percent luxury tax on vehicles costing over $30,000 when they purchased pickup trucks and tractors.

But the move toward bigger SUVs over the years has increased the number of those vehicles that qualify -- whether they are used for work or not.

Thirty-eight SUV models -- including the Cadillac Escalade, Lincoln Navigator, Chevrolet Suburban 2500, Dodge Durango and the Ford Expedition -- qualify.

Bush wanted Congress to increase the existing deduction to $75,000 to encourage immediate spending by small business. The House of Representatives upped the amount to $100,000.

Some in the Senate, including Barbara Boxer, D-Calif., wanted to change the provision's wording to close the loophole.

If the bill is enacted, the tax break will expire in 2005.

Experts are unsure how much of the SUV sales market can be attributed to those purchased because of the loophole.

But Taxpayers for Common Sense, based in Washington, estimates the SUV loophole could cost taxpayers between $840 million and $987 million for every 100,000 vehicles sold to businesses, according to the organization's Web site.

And some point out the irony of having such a large tax break for vehicles that increase U.S dependence on foreign oil and pollute the air.

"It's not restricted to people who use trucks in pursuit of their business," said David Nemtzow, president of the Alliance to Save Energy, a Washington-based bipartisan coalition of business, government and environmental leaders. "We should be having tax breaks for fuel-efficient cars to make them more attractive. We think it's just a rip-off of American taxpayers."

Nemtzow said he has heard of small-business owners saying, "Oh yeah, I went up another size because the salesman pointed out the tax loophole."

But Eron Shosteck, spokesman for the Alliance of Automobile Manufacturers, said most small-business owners purchase SUVs for business purposes. The organization supports rewriting the provision to include SUVs as well as trucks.

"Why should a contractor's vehicle be treated any differently than the power tools he hauls in the back of it?" asked Shosteck. "The way it is currently structured, it discriminates against small-business owners who use cars. You have to give business owners the benefit of the doubt that they are using SUVs for business purposes."

RUBY BAILEY can be reached at 202-383-6036 or [email protected].
 

·
Registered
Joined
·
1,206 Posts
"Why should a contractor's vehicle be treated any differently than the power tools he hauls in the back of it?" asked Shosteck. "The way it is currently structured, it discriminates against small-business owners who use cars. You have to give business owners the benefit of the doubt that they are using SUVs for business purposes."
<font size="2" face="Verdana, Arial">I've never seen a contractor haul tools, paint or ladders around in an Escalade.

They all use trucks or vans.

[ 05-23-2003, 04:01 PM: Message edited by: Ozmotear ]
 

·
Registered
Joined
·
2,957 Posts
Discussion Starter #4
Originally posted by Ozmotear:
</font><blockquote><font size="1" face="Verdana, Arial">quote:</font><hr /><font size="2" face="Verdana, Arial"> "Why should a contractor's vehicle be treated any differently than the power tools he hauls in the back of it?" asked Shosteck. "The way it is currently structured, it discriminates against small-business owners who use cars. You have to give business owners the benefit of the doubt that they are using SUVs for business purposes."
<font size="2" face="Verdana, Arial">I've never seen a contractor haul tools, paint or ladders around in an Escalade.

They all use trucks or vans.
</font><hr /></blockquote><font size="2" face="Verdana, Arial">what about those who drive a Focus Wagon For work why don't they qualify?
 

·
Not Special Enough
Joined
·
10,540 Posts
Its a good deal for those that need large vehicles for their job, but It sucks that somebodys tanning salon or bridal shop qualifies for the same tax break.
 

·
Registered
Joined
·
597 Posts
jebus. get those friggin things off the road.

There will probably also be some loophole in there so trucks will only have to meet emmision standards of 1950 also, and get even a bigger tax break for doing so.
 

·
Registered
Joined
·
2,957 Posts
Discussion Starter #10
Originally posted by OC_SVT:
I think the Law was designed to encompas vehicles over 6,000 pounds. Triple the wieght of your wagon and you are in.
<font size="2" face="Verdana, Arial">The law encourages small businesses to buy vehicles over 6000lbs, rather than buying a focus wagon.

honestly Most Small businesses could make do with a transit connect.

hauls 500+ lbs and get 40+ miles to the gallon.
has more interior space than a H2 and most SUVs.




The law deters people form buying more econmical vehicles.
 

·
Registered
Joined
·
1,389 Posts
Interesting. Very interesting.
 

·
Registered
Joined
·
1,179 Posts
Originally posted by AnythingButAFocus:
And here it is!




Andrew
<font size="2" face="Verdana, Arial">Is that yours?
 

·
Registered
Joined
·
2,728 Posts
that thing is kinda cool, I'd pimp it....

on the other hand its kind of convenient how gas guzzlers get the tax breaks......IMO...
 

·
Banned
Joined
·
17,312 Posts
Originally posted by AnythingButAFocus:
And here it is!




Andrew
<font size="2" face="Verdana, Arial">Poor thing looks like a Joke w/ a Broken Suspension.
Like Somebody Stepped on a Hot-Wheels car...
 

·
Registered
Joined
·
1,177 Posts
...Yet another reason why I hate republicans...
 
1 - 19 of 19 Posts
Top