Loopholes for sale: tax-leasing bonanza for utilities

Journal Article · Mon Feb 01 04:00:00 EST 1982 · Power Line; (United States)

OSTI ID:5556512

Morgan, R E

Federal tax codes that permit utilities to charge phantom taxes to their customers and never pay to the government may now be expanded by the Economic Recovery Act (ERTA) to allow utilities to collect surrogate taxes from other corporations looking for loopholes. Utilities are taking advantage of Safe Harbor or tax-leasing arrangements that permit a financially sound power company to sell new investments to another company and lease them back. Opponents to ERTA claim the cost to individuals will be $250 a year in lost revenues to the federal government, and they see it as the biggest corporate giveaway in history. Critics also object to benefits going to companies which are not needy and which might use the new cash to expand construction plans. Ratemaking arrangements will be affected by the tax-leasing deal, but utilities argue that the benefits fall short of their needs. 1 table. (DCK)

• OSTI ID: 5556512
• Journal Information: Power Line; (United States), Journal Name: Power Line; (United States) Vol. 7:7; ISSN POLID
• Country of Publication: United States
• Language: English

Related Subjects

29 ENERGY PLANNING, POLICY, AND ECONOMY
296000* -- Energy Planning & Policy-- Electric Power
ELECTRIC UTILITIES
FINANCIAL INCENTIVES
LEASING
PUBLIC UTILITIES
TAX CREDITS
TAXES