TEI urges prompt enactment of economic stimulus legislation: November 13, 2001.

On November 13, 2001, TEI submitted its recommendations for Economic Stimulus legislation to the members of the House Ways and Means and the Senate Finance Committees. The recommendations follow-up on previous recommendations and comments TEI submitted to the House Ways and Means Committee on October 15, 2001. In addition to the November 13 and October 15 submissions, TEI forwarded a one-page summary of its recommendations to the House and Senate leadership on November 30, 2001. TEI's November 13 submission is reprinted below. The October 15, 2001, recommendations are reprinted in the September-October issue of The Tax Executive. The one-page November 30 document may be obtained by sending an e-mail message to asktei.org.

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As the Senate considers critically important legislation to stimulate the faltering U.S. economy, Tax Executives Institute is pleased to submit the following recommendations. As the preeminent association of in-house tax professionals, the Institute endorses the prompt enactment of legislation to provide significant tax relief to, and hence effectively stimulate economic activity by, the sectors of the American economy most affected by current economic conditions. Regrettably, overheated rhetoric has slowed progress on the bill. TEI strongly recommends that any desire for partisan advantage be put aside and that the parties work cooperatively to craft a bill to achieve the unassailable goal of stimulating the economy in an efficient, effective, and even-handed way.

No sector of the economy or of the Nation has been untouched by the current economic downturn and the aftermath of the September 11 attacks. To be sure, some industries and groups (including those directly affected by the terrorist attacks) have been more severely affected, but in our view the pending legislation needs to address the entire economy and the entire country. The key lies in developing the proper balance of tax and non-tax provisions and, further, the proper balance of individual and business provisions.

TEI represents a cross-section of the business community, and our members know first hand the ins and outs of the Internal Revenue Code and tax laws around the world. They live with them (and, indeed, with continual tax audits) on a day-to-day basis. TEI strongly believes that, rhetoric aside, it makes eminent sense to craft a stimulus bill that, at its core, includes provisions to directly and significantly stimulate business activity because such legislation will have a "multiplier effect" beyond that of narrow tax and spending programs; it will serve as a catalyst to the broader goal of economic growth. If the legislation spurs investments, jump-starts the economy, and decreases unemployment, all segments of society will benefit. Again, the key is balance. Keeping this in mind, Tax Executives Institute recommends the enactment of proposals--

* To lengthen the carryback period for net operating losses to five years.

* To repeal the corporate alternative minimum tax and to refund, immediately or over time, all accumulated AMT credits.

* To allow substantial additional first-year depreciation on...