The Chamber has turned its attention toward the Senate in its efforts to push through Congress an economic stimulus package. The day before the Senate Finance Committee was to consider its portion of the $825 billion proposal, the U.S. Chamber sent a letter to the leaders of the committee praising them for including key tax incentives but also calling for additional ones to "restore liquidity, spur economic activity, and stimulate job growth."

 "What the committee has outlined is a good first step," says Bruce Josten, Chamber Executive Vice President for Government Affairs. "Our economy basically operates on two bookends; one is credit and the other is confidence. We don't have a lot of either right now. Restoring credit and confidence is critical, and easing the tax burden on companies is a big step toward this goal."

Chamber-supported tax provisions contained in the original Senate draft include the following:

• Extend from two years to five years the period for which businesses could carry back losses. This would enable businesses that are now losing money to apply those losses to years when they made a profit, qualifying them for refunds on the taxes paid for those years.
• Extend bonus depreciation that allows businesses of all sizes to depreciate 50% of the cost of capital investments immediately.
• Extend Section 179 expensing provisions that allow small businesses to immediately write off up to $250,000 in equipment purchases rather than making them depreciate the cost over time.
• Delay for one year the 3% withholding tax on all government payments scheduled to go into effect in 2011.
• Drop the requirement that first-time home buyers pay back the cost of their housing credit (up to $7,500) within 15 years.

The Chamber also commended the committee for including a provision that would waive taxes on certain income when debt is repurchased at less than face value, as well as a provision to extend Trade Adjustment Assistance programs for workers who have been displaced by trade.

The Chamber urged the Senate to go further by adding to the package these items:

• A payroll tax holiday
• Reduction of the corporate capital gains tax rate
• Modification of pension fund reporting and funding requirements
• Temporary repatriation of foreign subsidiary earnings at a reduced tax rate
• Relief for the distressed real estate industry.

Read the Chamber's letter to the Senate Finance Committee.