Tax-exempt financing in the President's budget.
Government Finance Review › Vol. 12 Nbr. 2, April 1996
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Summary
Implications of the provision on corporations
The Clinton administrations's proposal to eliminate a corporate tax deduction which it misconstrued as a corporate welfare provision can have an adverse effect on state and local government funding and even on nonfinancial corporations which will be taxed like for-profit entities. The attack on tax-exempt financing is largely contrary to Clinton's stance during the late 1980s when he advocated tax-exempt bonds.See the full content of this document
Extract
Tax-exempt financing in the President's budget.
During the budget reconciliation negotiations on the FY1996 budget in December 1995, the Clinton administration offered to eliminate a corporate tax deduction that it described as a corporate welfare provision and, in the process, set off a battle with supporters of tax-exempt financing. The proposal would have a profoundly negative effect on state and local government financing costs and would not harm the targeted corporations. It was offered again as part of a larger package in January, and on February 5, 1996, the administration included the provision in the President's FY1997 budget request submitted to Congress.
Under current law, the general rule is that ...See the full content of this document
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