Industry associations voiced strong support for a bill to extend expiring tax cuts and jobless benefits that President Barack Obama signed into law Friday.
The Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010, which extended current tax cuts for individuals for two years, was passed late Thursday in the U.S. House of Representatives by a vote of 277 to 148. The Senate approved the bill earlier this week by a vote of 81 to 19.
Scott DeFife, executive vice president for policy and government affairs for the National Restaurant Association, said the NRA “believes this tax agreement is vital to economic recovery, and we commend the White House and bipartisan Congressional leaders for moving this compromise package."
He added: "The bill will provide certainty for the next couple of years that both encourages business investment and allows consumers to keep more of their income, which will help spur more economic activity.”
“Members of Congress have clearly heard the concerns of the franchise small business community that extension of these tax cuts will provide much-needed economic certainty for the $2.3 trillion franchise industry that is struggling to recover from the recession,” said Steve Caldeira, president and chief executive of the International Franchise Association. Chain restaurants comprise about 42 percent of the IFA’s membership.
Matthew Shay, president and chief executive of the National Retail Federation, the parent of the National Council of Chain Restaurants, said the extra money created by the tax package “is going to go to satisfy pent-up demand, and will help stimulate activity and job growth as it spreads throughout the economy. In addition, the business expensing provisions of this package are going to provide employers with powerful incentives to invest and create jobs. This is a clear win for our nation’s economy.”
In addition to extending the Bush-era tax-cut breaks to individuals, the measure also provides the following tax breaks:
• A decrease in Social Security payroll taxes, to 4.2 percent from 6.2 percent for one year.
• Estate tax exemptions through 2012 — assets over $5 million per person will be taxed at a 35-percent rate.
• Businesses will be able to completely expense capital investments in 2011.
• The work opportunity tax credit, or WOTC, will be extended through 2011 and will be effective for employees hired after date of enactment.
• Extension through 2011 of the special 15-year depreciation period for restaurant buildings.
Contact Paul Frumkin at [email protected].