Why basing fiscal policy on the taxation of corporate jets probably isn’t a good idea:
President Barack Obama’s proposal to end a tax break for corporate jet owners, a repeated refrain in his news conference yesterday, would achieve less than one-tenth of 1 percent of his target for reducing the federal deficit.
Such a change would put $3 billion into the Treasury over a decade, said two congressional aides familiar with the proposal. Democrats want to require companies that use jets for business purposes to write off the cost over seven years, instead of the five years allowed under current law, said a congressional aide and a White House aide. Airplanes used for charter or commercial flights already must be depreciated over seven years.
Obama mentioned the corporate jet break six times, criticizing Republicans’ unwillingness to include tax increases in legislation to raise the federal debt ceiling. Republicans are pressing for spending cuts in the measure, which must be passed before Aug. 2, when the Treasury Department projects that the U.S. will no longer be able to meet its debt obligations.
“It would be hard for the Republicans to stand there and say that the tax break for corporate jets is sufficiently important that we’re not willing to come to the table and get a deal done,” Obama said during the White House news conference.
It would take much more than eliminating a break for corporate jets to complete the deal. The $3 billion proposal would generate 0.075 percent of the $4 trillion in deficit reduction that Obama is seeking through a combination of spending cuts and tax increases.
More on Obamaesque misstatements here. Certainly, more than a mere two Pinocchios are warranted, though the two–and the misstatements that led to them–are damning enough.