Banks May Get Huge Tax Break
From the WSJ:
There are few better feelings than getting a windfall tax rebate when you are feeling broke. Large loss-making banks could experience this pleasure very soon.
As part of economic stimulus efforts, the incoming Obama administration is considering tax changes that could give stumbling financial companies increased tax rebates. Right now, companies can use losses to reduce taxes on any future earnings, as well as on profits going back two years.
In theory, a company that lost $10 billion in 2008 would be able to claim back taxes paid on an equivalent amount of taxable income in 2006 and 2007.
The key Obama change is to extend the retroactive application to five years, theoretically increasing the amount of past taxes that qualify for rebate. The move could clearly benefit banks where losses in 2008 and 2009 are going to be so large that they overwhelm profits from the last two years.[...]
Incredible… Just goes to show that the bigger a company screws up the bigger the mattress they are given to soften their fall. I say “give them nothing“.
I agree. They have proven themselves wretchedly untrustworthy!
If the Obama admin wants to let them go back five years. I say no bonuses, pay increases or deferred income for ALL executives for five years henceforth.