IDG News Service - WASHINGTON -- The U.S. House of Representatives approved a bare-bones version of the economic stimulus bill that has been a matter of much debate in the Senate during the past few months.
By a vote of 417-3, the House yesterday passed the Job Creation and Worker Assistance Act, which includes a modification to tax laws that would let businesses depreciate IT equipment more quickly. The bill now goes to the Senate for a vote.
President George W. Bush will sign the bill into law if the Senate passes it, press secretary Ari Fleischer said during a briefing yesterday.
The House proposal would let businesses expense upfront 30% of the value of capital assets such as IT software and equipment, instead of depreciating the entire cost over a five-year period as current tax law states. It also cuts the depreciation time of some IT equipment to three years. If the bill passes, this provision will be in effect for three years.
Members of the IT industry applauded the House's action, with hopes that the tax law depreciation changes for computers and software will encourage businesses to buy more equipment.
"The IT industry ... has long advocated adopting the provisions contained in this bill to bring accounting practices in line with technological innovation and growth," Harris Miller, president of the Information Technology Association of America trade group, said in a statement. "Passage of these provisions would be an overwhelmingly gratifying win for our industry." The Business Software Alliance also issued a statement in support of the bill.
Rep. William Thomas (R-Calif.) was less enthused because he wanted a bill with more economic incentives. Some form of an economic stimulus package has been under debate in Congress since the fall; yesterday's bill represents the sum of what the Republican-led House and Democratic Senate are likely to agree on, he said.
The House had passed a more inclusive economic stimulus bill in the fall, but it fell victim to partisan debate once it moved to the Senate.
"This bill isn't what any of us thought or hoped we would be passing when we set out in September to enact legislation to get our economy back on track," said Thomas, who is also chairman of the House Ways and Means Committee, in a statement. "The areas where we are able to agree form a skeleton bill that does the minimum to help displaced workers and businesses cope."
In addition to modifying IT purchasing tax laws, the bill offers extended unemployment benefits and investment incentives forrebuilding lower Manhattan, the part of New York City where the two World Trade Center towers stood before the terrorist attacks of Sept. 11.
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