Tax Bill Is Good For Textile Manufacturers
By James A. Morrissey, Washington Correspondent
The $70 billion tax relief package that President George W. Bush will sign into law later this week should provide some help to the beleaguered US textile industry. Provisions granting more liberal treatment of investment credit and capital gains and investments in plant equipment will be a source of funds to help the industry modernize and compete with overseas manufacturers.
The new bill extends for 10 years many of the provisions contained in the Jobs and Growth Act of 2003. Among those provisions was an increase of the amount small business may expense from $25,000 to $100,000. It also increased from $200,000 to $400,000 the amount of total investment credit a business can take in a year.
As the bill cleared Congress, Jim Chestnutt, president and CEO of New York City-based National Spinning Co. Inc. and chairman of the Washington-based National Council of Textile Organizations, saw it as a key to enhancing the US textile industry's competitiveness by generating funds for investments in plants and equipment. He said: "This legislation provides important incentives for continued investment in US textile manufacturing that will help ensure the future competitiveness of our industry. Extending the current lower rates on capital gains and dividends and maintaining the current levels of expensing will have a positive impact on the US textile industry and will help stabilize our industry against job losses caused by low-cost imports from China."
May 1, 2006