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Vehicles that qualify for so-called SUV tax deduction for business

24

Comments

  • fintailfintail Posts: 33,509
    Not was it due to residual trickle down effects as some have claimed...
  • highenderhighender Posts: 1,362
    sorry, I was posting near midnight, and the post got lost....so I will repost again.

    But a lot of these sales would have happened anyway. It's a small subsidy. I'm really curious as to the costs vs benefits of such legislation.

    True...in the midwest and farmlands people would buy a truck anyways. IT is a small subsidy...but it would help America's auto makers sell their products...hey..that is great ! Just look at how Japan and China protect their own products, by slapping import duties of up to 100%. I was just in a Rolls Royce dealership in Guangzhou in Jan....You know how much do they want for a Rolls Phantom ? about 1 million US>> double the price, and I asked why, and they said import duty .

    Let the US slap import duties on Toyotas, textiles, Hondas, etc....( but wait, they are one step ahead,,,they built factories here...and still take the profits home...oh well) . Let us level the playing field...

    IMO letting already wealthy people writeoff silly vehicles in a time of massive debt and deficit is painfully shortsighted.

    I think you are not seeing the big picture. The law allowed many people to accelerate their depreciation...basically writing off the entire car. Now that the money went to the auto maker....which can them pay their workers....and their workers can go on buying also. As to the people who used the writeoff, not only do they get a new piece of machinery that can generate profit, but they still have more money left over....to either hire more workers in the US, or buy an expensive luxury item...either way...the money is circulated back into the economy.



    When you can't sink lower, there will always be an improvement. Chinese cases always show this. That dies not prove trickle down theory.

    China could have gone the way of North Korea..which has famine nearly every year. China has 1.2 bil people...lots of mouths to feed. They used to import food. Now they make enough of their own. Our US consumerism is trickling down to their every corner. Believe me, I was there last April, and then again 2 months ago.

    Before China opened up, my workers said life was easy.....they used to just show up for work, talk, and play some ping pong, and then go home....no incentive to work. Now with market based economy...everyone wants to work...and get some of the money that Americans gave Walmart(example) to give to the Chinese economy. NOw even in some relatively unknown cities, people are driving cars., and using cell phones, and computers. THis was unheard of 15 years ago.


    "and the ladies are all wearing the most fashionable shoes"

    But are they real, or $10 fakes? I once received a fake pair of Bally shoes as a gift...they look OK, but the materials, not quite.

    Whether fakes (there are $5 fakes.) or real ones...they are forging ahead with the trickle down money that was nonexistant a mere 15 years ago. I almost bought a $7 pair of real nikes...since they are made there.

    China is a poor example for so many economic issues,

    I disagree. Having traveled to many places...I think we have to have more basic factories to provide jobs and products for our own use. Sending all our money over to another country...is ultimately not good for our own economy.....in general. But it has been good for china and Audi. BTW, which vehicle is the official government vehicle of China ? ( I will give you 3 guesses, but you will only need one )

    not to mention the continued human rights atrocities.

    I agree here. I almost went up to a security police at Tian An Men Square, to ask them why they are letting the atrocities go on. But my friend and wife told me to wait til they run clear, as they did not want to be held incommunicado for 10 years on no charges. The security guy that I talked to (not about the massacre) , answered my questions, and when I walked away...he detained a person for no reason, and searched the persons bags... something that is unconstitutional here. I have a picture of it that I sneaked in. :mad:

    That alone is a good reason to buy American, you're at least supporting a mainly benevolent system

    I think we should try to make better products at a good value, so that our people will want to buy American....and try to buy American...... :D
  • gagricegagrice San DiegoPosts: 28,850
    Further clarification:

    Internal Revenue Service Code Section l79 lets a business write off the purchase price of equipment the first year (up to a
    total of $105,000). This code section eliminates the delay of depreciating assets over a number of years. Passenger cars aren't eligible for the equipment tax deduction. But trucks and SUVs are. However, there was a $25,000 ceiling for trucks or SUVs, limiting how much could be written off the first year.

    A loophole in the $350-billion stimulus plan passed in 2003 removed the $25,000 ceiling for SUVs. The large SUVS (over 6,000 pounds GVWR) were considered trucks, not passenger vehicles. The amount expensed the first year grew from a maximum of $25,000 to the full $105,000 in 2005. Suddenly, being able to write the full purchase price off immediately made the larger SUV a more attractive purchase. They gained an edge over regular automobiles and smaller SUVs subject to customary depreciation or the $25,000 ceiling.


    SUV tax break
  • fintailfintail Posts: 33,509
    There's something about being an emigrated Chinese and being a trickle-downer. I guess the harsh failure of Chinese wannabe communism/socialism can do that. All of this seems so familiar.

    "I think you are not seeing the big picture. "

    I think I am. It's simply the public subsidizing a private luxury. I love it when I see a commercially plated luxo-SUV parked at the local trendy mall on a Sunday. I guess taking the Mrs. to get her weekly $1000 handbag is business use!

    I'm sorry, but I just don't see China as proof of this economic theory working in our mature economy. With all due respect, it is apples to oranges for me. And the economic progress there (could there really be regress compared to the China of 30 years ago?) certainly has not improved freedom. Kind of like how, slowly but surely, freedom isn't improving here either.

    Again, I want to see an analysis of the costs of such reverse-socialism vs the benefits. Can numbers prove it to be fiscally responsible?
  • highenderhighender Posts: 1,362
    I am not sure what you are trying to get at. :confuse:

    My point is really simple. If you buy a product from country A, then the money or profits go to that country A. Not the country B that you live in, though it may have some inport export benefits, and some dockworkers will have jobs.

    China had no market and no factories. Then we dismantled our factories here in America, and built them there. Now there are tons of factories....even on the side of freeways..which is all new. The new airports are top notch. Now if we kept the factories here...and also bought American, then the money would have circulated here...pure and simple. We have to try to make our own good more attractive.

    Jobs Stimulation Package took this into account, and thus many US auto makers...plus some foreign ones, benefited.

    But the effect cannot last, due to recent trends to buy foreign autos and the huge health care burden each car made here has. Toyota has only a $300 health care burden per car sold. GM has a $1400 health care burden per vehicle sold..... :cry:

    A SUV can be used anywhere...even at a mall. I think monies should be allowed to circulate in the private sector more...instead of the government sector...which often just burns it up in hiring more inefficient people to push papers. San Francisco was a victim of this when Willlie Brown was mayor.

    There are all sorts of tax breaks....and if they help the industry....I say go for it. That is what the European Union, Asian nations, and many other countries do to us. Look at Airbus, and how Boeing has to compete with this Euro-country owned corp.

    The tax breaks are there for a reason. IT is not simply money going into pockets of the rich. That is the simplistic view IMHO....""what does not benefit me...is wasteful view. The rich do not bury the money....they have the notorious habit of spending money on many things....actually injecting it back into the economy.
  • fintailfintail Posts: 33,509
    I didn't think it would be clear. I won't go into it, I'm not looking for a fight. All of this just seems very familiar.

    I'd just like to see a cost-benefit analysis of this subsidy. It's really a bizarro-world form of socialism when you look at it.

    And I can't have blind faith.
  • gagricegagrice San DiegoPosts: 28,850
    I'd just like to see a cost-benefit analysis of this subsidy.

    It was quite simple. Buy more big ticket vehicles mostly US made. Benefits US manufacturers and small businesses. I believe the analysis can be construed positive or negative. It depends on which side of the political fence you are on. To those that hate big vehicles and believe they are the end of our existence will say the benefit to business is not justified.

    The bottom line is it worked and stimulated sales of large PU trucks and SUVs. It really is perspective. I believe in a capitalistic approach to business. Without tax breaks & incentives small business does not thrive. The government needs to keep hands off except in the case of monopolies.
  • fintailfintail Posts: 33,509
    I wanted some numbers. Theories are awesome, but they are theories.

    The government needs to keep its hands off, but businesses need tax breaks and incentives? Hmmm, that's interesting. And it's just not small businesses that make out. Reverse socialism.
  • highenderhighender Posts: 1,362
    fintail:

    I am not looking for a fight either...( you got your pistol ready? we will do it the old fashion way !) J/K

    I have done some research , (specially on animals with tail fins) ...and one thing stands out...numbers , though important, are hardly ones which can decide this. There is a saying, find a stat to prove one thing, and someone can find a stat to disprove it.

    First eggs are good for you...then they are bad...now they are good....all backed up by stats...

    Sometimes...numbers are just there. Economics is theory and numbers...and they still cannot predict anything with any degree of certainty.
  • fintailfintail Posts: 33,509
    Yeah, I know...there are three types of lies as well. Simple numbers only go so far.

    I just haven't seen this idea to be shown to be fiscally responsible. If it really is there to act as a subsidy for automakers, then so be it, but the powers that be shouldn't disguise it as some kind of great beneficiary for anyone else.
  • highenderhighender Posts: 1,362
    I agree ......

    OK...you are right....it would be nice to have numbers ..however little, to at least try to quantify any cost/benefit...

    sometimes theories and good intentions makes things worse. Here in California, we mandated MTBE to be added to gasoline mixture, in order to make the air cleaner. It cost the refinery industries over $4 billion to retool all manufacturing to process the MTBE mix. Now...we find that MTBE poisons our water system...and eats thru gas tanks.

    All gas stations are required to exclavate and renew their underground storage tanks....at great cost. :sick:
  • rockyleerockylee Posts: 14,011
    Not that there is anything wrong with that.

    Well when they try to kick are butts in WWIII, I want you on the front lines along side of me. :sick:

    With your theory, it is not much different than giving Kim Jung Mentally ILL the codes to our nuclear weapons. :confuse:

    I just can't understand people that have this
    "global is good" attitude on everything. Ronald Regans "trickel down theory" has had it's effects. It makes the rich "richer" and the poor drive Geely's and live in trailers with there whole immediant family. :sick:

    Rocky
  • highenderhighender Posts: 1,362
    rocklee:

    YOu missed my point....

    I will fight for the good ole USA ! I will be in the foxhole right next to you....with my chem-bio suit on and hopefully it was made in America ?

    rocky: Well when they try to kick are butts in WWIII, I want you on the front lines along side of me.

    Like I said...I will not be in the opposing foxhole...


    With your theory, it is not much different than giving Kim Jung Mentally ILL the codes to our nuclear weapons.

    MY statement "not that there is anything wrong with that ( regarding globolization) "" was a feeble attempt to be politically correct...or maybe sarcastic attempt. IF you read my posts carefully....I am all for the GOOD OLE U.S.of A. (pipe in 'Battle Hymn of Republic' here) . For the record... I think we should buy more American made goods, if possible. I think Americans need to be more competitive such that people will say GM is the best car company in the whole world.

    I am quite against Kim Il Jung and the shenanigans of North Korea. That is why I am advocating more factories here, and less outsourcing.

    I just can't understand people that have this
    "global is good" attitude on everything.


    WEll..global is good , depending on what you are talking about. For environmental issues...thinking global is good. FOR economic issues, I think we have to keep more industries here...and not move our factories to other countries..... I have been one of the most ardent supporters of USA here...and it does have a bearing on vehicles and this thread.

    Ronald Regans "trickel down theory" has had it's effects. It makes the rich "richer" and the poor drive Geely's and live in trailers with there whole immediant family.

    Though there were flaws in Reagans' economic policy, the fact is that there still were many opportunities here in the USA ....but one has to work and earn it. THere are lots of lazy people who do not work , or do lousy jobs...and expect to get paid, or laid off and get paid. But this is off topic . Globalization has moved all the lower end jobs off shore....so that one needs a great university degree to land a good job...and that is not good for US.

    I hope we could recapture the glory days after WWII, when GM/Ford products were the icons of quality and reliability. Even the presidential vehicles of many countries were Lincolns or Cadillacs.
  • rockyleerockylee Posts: 14,011
    I'm sorry I misunderstood you pal. Glad you will be there by my side. ;) We thankfully agree on most of it. ;) I however still don't agree with your position on importing lower end chinese made goods. :blush:

    Rocky
  • highenderhighender Posts: 1,362
    hi Rocky:

    Yes...we are agreeing on maybe 95% of the things regarding US vs others.

    Can you clarify your position on this ? ( the importing of lower priced goods ) ?

    I think tax deductions may have been instituted to help the US auto makers, as well as midwest farmers and small business owners.
  • gagricegagrice San DiegoPosts: 28,850
    Ronald Regans "trickel down theory" has had it's effects. It makes the rich "richer"

    I think you have mistaken which economic policy made the rich richer, while not increasing the wage of the worker.

    In 1980, according to Andrew Tobias, the typical CEO made 42 times as much as his average worker. In 1990 it had doubled to 85 times as much as the average worker. During the next ten years up to 2000, that amount went to 531 times as much as the average worker. Tell me which economic plan works best for the rich?

    If you look at the tax plans of the left party. They do not take aim at the real wealthy with their cash in foreign banks & bonds. They target the middle class to upper middle class. It is elitism that we should be fighting not free market economy.
  • rockyleerockylee Posts: 14,011
    Hello, highender

    My position is I'm against importing goods that can be made here in the U.S.-period. I believe all imports should be tarriffed and if those company's want to sell it here, then they need to make the product here. ;) Our corporations are essentially building up our enemy's wealth. The Big Red Machine's army is about 2 million people. The only way to stop them is using a Nuke. They got em' too. China is getting rich and powerful, while we keep loading up debt which they purchase in the form of Treasury Bills. :sick: They are essentially buying America. Well atleast we agree 95% vs. 0 % :D

    Rocky
  • rockyleerockylee Posts: 14,011
    I'm not a die hard democrat. I'm a registered democrat, but had a hard time voting for Kerry. *Gulp* :surprise:

    I hope John Edwards will get the nomination this time around. He is an american worker and buisness protectionist. Edwards is a little flip floppy on the border issue. :( If we don't get a new mentality in Washington, their won't just be a UAW anymore, but a huge reduction in american manufactoring. I suppose President Bush will get his way and reclassify the manufactor of hamburgers at the local Dairy Queen as net manufactoring job gains. :confuse:

    I do agree with you that it wasn't just Reagans administration where CEO's over the years had huge salary and compensation gains. The 90's we saw a huge growth of jobs, thus huge growths in salary's including manufactoring ones. Now your average Joe is making what he did in year 2000, so we've taken a 6 year regression unfortunatly. The left is as much to blame as the right, both have a few politicians that do believe we as a society are getting out of control (spending) However it seems they are still in the minority. :sick:

    Rocky
  • PF_FlyerPF_Flyer Pennsylvania Furnace, PAPosts: 5,854
    Let's swing back to the topic please. We are NOT here to discuss politics.

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  • gagricegagrice San DiegoPosts: 28,850
    I cannot for the life of me understand why you would not have praised the $100k tax deduction for small businesses. It was good for the little guy and it was good for the Big 3. If they had made it for cars and light SUVs the money would have ended up in Tokyo instead of Detroit. Your dad may have built parts for some of those PU trucks and SUVs that were purchased under that tax bill. It stimulated sales of the vehicles GM builds best and can make a profit on. I think the only Toyotas that would qualify was the Land Cruiser and LX470. Both way over priced. Not built for the working class buyer.
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