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COFES Blog
Nov
11
Written by:
Russ Henke
11/11/2008 5:49 PM
While President-elect Obama and Democratic House and Senate leaders are pushing urgently for quick action on financial assistance to help the troubled US auto industry, with hundreds of thousands of jobs hanging in the balance, we discover today (November 11, 2008) a semi-secret giveaway (after the fact) to banks that so far are hardly helping boost the economy, to wit:
Some of the nation's biggest banks are in for a windfall - on top of the $700 billion government bailout - thanks to a new tax
policy quietly issued by the Treasury Department. The notice gives big tax breaks to companies that acquire struggling banks
hit hard by the mortgage crisis. In some cases, the tax breaks could exceed the cost of acquiring the banks, according to
analyses by private tax experts! The change could cost the Treasury as much as $140 billion extra by enabling firms
that acquire struggling banks to use more losses incurred by those banks to offset their own taxable profits.
The notice was silently issued September 30, 2008 as Congress debated the original $700 billion bailout plan. Some
members of Congress are upset that such a sweeping tax change was issued with no public hearings or
congressional input.
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