GDP, he argued, does not allow for the depreciation of capital goods so it exaggerates productivity gains.
Further, the depreciation of capital is more lucrative the higher the nominal rate.
That is because the average rate of depreciation of the capital stock has risen as investment has shifted from traditional machinery to shorter-lived assets such as computers and software.
Despite a reinstitution of 100% depreciation for capital equipment, much of that demand was pulled into 2011, as the business community was uncertain as to whether or not the tax break was going to be reinstated in 2012.
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The high capital depreciation of this equipment must be offset by running it at full capacity, so rather than cut production the market participants lower prices to entice customers away from their competition, creating a downward price spiral.
For example, MMA Renewable Ventures and its investors enjoy a 30% tax credit, have the benefit of accelerated capital depreciation schedules, and sell solar energy credits generated by the project to NV Energy, which must obtain 20% of its power from renewable sources by 2015.
It is highly likely that a good portion of this money will make its way towards reinvestments in new farm machinery that can enjoy accelerated capital depreciation under the tax code if purchased before the end of this year.
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Most economists agree that the best policy today in terms of stimulating the economy is to accelerate depreciation for capital investment, and lower the payroll tax.
It can handle a sale, which is complicated because your gain will include not just capital gain but a recapture of depreciation and an unsuspension of suspended losses.
Capital depreciation can account for 50-80% of manufacturing cost in this kind of plant.
NiSourcecited increased depreciation expenses from increased capital expenditures and increased operating expenses from retrofitting of older coal plants as reasons for the shortfall.
Again, there is machinery and software but these are a much smaller portion of the capital stock and have much, much higher depreciation rates.
He advises buying when pharma is trading at low multiples of earnings, sales, cash flow (in the sense of earnings before interest, depreciation, taxes and amortization but before capital spending) or all three.
NiSource (nyse: NI - news - people )cited increased depreciation expenses from increased capital expenditures and increased operating expenses from retrofitting of older coal plants as reasons for the shortfall.
In last night's State of the Union message, President Obama tipped his hat to small businesses with an extension of accelerated depreciation, tax credits for hiring people, and a cut in capital-gains taxes for investments in small business.
If you use business assets as part of your barter, you may have capital gains, ordinary gains and depreciation recapture to report.
This measure, an obsession of real estate research firm Green Street Advisors (which provides us with much of our REIT data), is net income plus depreciation minus maintenance-level capital expenditures.
As I described in Part Two of this series, driverless cars have the potential of dramatically reducing the transaction costs associated with transportation, including the capital cost, depreciation, fueling, maintenance and insurance.
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Capital expenditures will be funded by internally generated funds (depreciation and other allowances), sale of non-core assets, partnerships and debt.
It allows a business to deduct the entire cost of a small capital purchase immediately, rather than writing it off over time and having to hassle with depreciation schedules.
It typically works in conjunction with another break, Sec. 179 that allows a business to deduct the entire cost of a small capital purchase immediately, rather than writing it off over time and having to hassle with depreciation schedules.
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