[Congressional Record Volume 150, Number 45 (Friday, April 2, 2004)]
[Extensions of Remarks]
[Page E522]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




LEGISLATION TO MAKE BONUS DEPRECIATION A PERMANENT PART OF OUR TAX CODE

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                           HON. JERRY WELLER

                              of illinois

                    in the house of representatives

                         Friday, April 2, 2004

  Mr. WELLER. Mr. Speaker, today, Congressmen Neal, Upton, English, 
Tiahrt and I have introduced legislation to make bonus depreciation a 
permanent part of our tax code. I appreciate the opportunity to make a 
statement on this important legislation.
  As you know, the issue of bonus depreciation has been an important 
one over the past 2 years. On March 9, 2002, President Bush signed the 
Job Creation and Worker Assistance Act of 2002 into law. This law 
allows businesses to accelerate the depreciation of equipment they 
purchase between September 11, 2001 and December 31, 2004. All 
equipment with a depreciable life of 20 years and under qualifies for 
the bonus depreciation treatment. Originally they were entitled to get 
a bonus of 30 percent in the first year. Before this law, a $1000 
computer would be depreciated equally over 5 years. $200 each year. 
With this change, businesses get $175 in the first year, plus a 30 
percent bonus. So, they depreciate $475 in the first year and the 
remaining $520 over the next 4 years ($175 each year for 4 years).
  H.R. 2, the 2003 tax cut law, included a provision to increase bonus 
depreciation to 50 percent through December 31, 2004. This provision 
became law in June 2003. This has helped stimulate the economy and 
create new jobs for Americans that are out of work.
  Just today, the U.S. Department of Labor released statistics that 
prove that bonus depreciation and other tax cuts are working. Bonus 
depreciation is helping to bring jobs back to the U.S. economy and put 
American workers back to work. The Labor Department announcement 
indicates that the U.S. economy created 308,000 new jobs in March, this 
is the fastest monthly job growth since April 2000. The latest data 
show that more than 500,000 new jobs have been created in the first 
three months of 2004.
  In another example, the General Aviation Manufacturers Association 
recently told me that in the first 5 months after enactment of the 
bonus depreciation provision sales of general aviation airplanes 
increased 45 percent.
  Mr. Speaker, bonus depreciation and the other tax cuts are working. 
Our economy is rebounding. We need to make bonus depreciation and the 
other tax cuts permanent in our tax code. When making business 
decisions, companies need to know for sure that they can rely on these 
tax provisions.
  I ask my colleagues to join me in cosponsoring this important 
legislation.

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