Obama targets business refunds in "huge" stimulus package

6 January 2009

US president-elect Barack Obama has included proposals to refund "billions" of dollars in past taxes to businesses hit by the current downturn as part of a "huge" economic stimulus package being prepared for when he takes office, according to reports.

The Associated Press said the total cost of the incoming administration's plans to kick-start the economy could top $800 billion.
Included in its plans are up to $300 billion in tax cuts, around $100 billion of which will be aimed at businesses.

Under the Obama team's proposals, companies who posted losses during 2008 could receive refunds on taxes they paid up to five years ago, allowing them to offset last year's deficits against previous profits.

Current legislation allows such firms to mitigate losses against profits made up to two years ago.

There will also be tax cuts for consumers, with up to $150 billion being set aside over two years to cover reductions for most individuals and couples, the site said.

Any package will need support from Congress and House Republican leader John Boehner said tax relief for "middle-class families and small businesses" would be essential to winning opposition support.

Mr Obama will formally take up his office on January 20th.

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