Financial Executives International wants any changes to corporate tax rates to be considered within a broad review of the tax code. The trade group is asking Congress to reject the proposed changes in President Obama’s budget. It fears that the changes will unfairly impose extra costs on U.S. businesses.
The March 27, 2009, letter signed by the FEI committee’s chairman Ron Dickel, asks the lawmakers to carefully review the president’s proposals, given the concerns about their long-term effect on the competitiveness of U.S. businesses in the global economy.
The FEI letter lists three areas of concern that it says, “would have a harsh impact on the overall economy and the competitiveness” of American firms. The following regarding LIFO:
Last-in, First-out (LIFO) inventory accounting method: The institute criticized Obama for proposing to repeal this accounting method in his fiscal year 2010 budget, saying LIFO “has been expressly permitted in the tax law for 70 years and has a solid foundation in financial accounting and economic theory.” The repeal of LIFO as a method of inventory accounting, the FEI said, would have an adverse effect on the finances of companies in many different industries, including general manufacturing, publishing, retail, and textiles.
Source: WG&L Accounting & Compliance Alert Checkpoint 3/31/09