The new budget/tax package hammered out by Congress overnight (Dec. 15-16) extends tax breaks that cable operators say have helped them invest in broadband buildouts, as well as a break for TV and film producers and a tax credit for R&D.
CenturyLink, for one, had pressed House speaker Paul Ryan (R-Wis.) and others in leadership not to let the accelerated and bonus depreciation provisions in the tax law expire Dec. 31. They were adopted to goose the economy during the Great Recession, but were extended for two more years in 2013, when they were initially to have sunset.
According to a website dedicated to the tax issue, the 50% depreciation bonus helps businesses cut their tax bills on new equipment purchases by allowing them to write off more of the cost.
CenturyLink said the provisions have helped the company invest billions of dollars to launch a gigabit network and that it continues to invest hundreds of millions in residential speed upgrades, fiber-to-tower, investments that would have slowed if the tax break were not extended.
According to the budget bill, that that bonus depreciation will be extended through 2019, though it ramps down to a 40% bonus in 2018 and 30% in 2019.
The Film and Tax section of the bill extends special expensing provisions (limited to the first $15 million for qualified film, TV and theater productions.
Also in the bill is a permanent extension for a research and development tax credit, which helps keep that R&D onshore, and which Intel was quick to praise.
“Intel commends Congressional leaders for joining together in support of the recent vote to permanently restore and expand the corporate R&D tax credit for businesses across our country," said Ron Dickel, VP of finance and director of global tax and trade. "As one of the largest private investors in R&D in the U.S., Intel understands the value of investing in American innovation and the direct benefits on U.S. job growth...With a permanent R&D tax credit, Congress takes a significant step in securing long-term American economic growth and technological leadership.”
Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.
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