Betsey Stevenson takes on retroactive corporate giveaways, a Congressional holiday tradition
“While Americans ready their holiday shopping lists, Congress is busy with its own holiday tradition—preparing a grab bag of corporate giveaways known as ‘tax extenders,’” writes Betsey Stevenson for a December 10 Bloomberg View piece. “The gifts, which range from the useful to the absurd, have one flaw in common: They’re about a year too late.”
Stevenson, who recognizes that some tax extenders might be beneficial (like tax breaks for the development of wind and solar energy), believes that the process by which Congress distributes them—i.e. retroactively at the very end of the calendar year—undermines any benefits they might produce.
“This leaves business in the dark,” she writes. “They can either go ahead with investments on the optimistic assumption that Congress will act, or they can be cautious and risk missing out. Then Congress rewards them—or doesn’t—for decisions made in the past.”
Read “How Congress Can Stop Its Tax Procrastination” for Stevenson’s plan to minimize the costs and maximize the benefits of Congressional tax breaks. (Spoiler alert: Forget 2015 tax breaks; it's already too late.)
Betsey Stevenson @BetseyStevenson is an associate professor of public policy and economics at the Gerald R. Ford School of Public Policy. She served as an appointed member of the White House Council of Economic Advisers (2013-2015) and as chief economist of the U.S. Department of Labor (2010-2011).