The recent down-to-the-wire tax agreement made by Congress on January 1 this year, made the Bush-era tax cuts permanent for most Americans thus averting a tax rate increase that would have occurred otherwise. Most other issues such as spending cuts, tax code changes and debt ceiling limits were put off to a later time. Nevertheless, in spite of these major issues left unresolved, Congress
specifically continue a tax break they have been enjoying for some time.
Interest in the auto racing events sponsored by NASCAR (owned by International Speedway) and other auto racetrack owners such as Speedway Motorsports has apparently been dropping off significantly in the past few years. Owners say they need to build new and better facilities to attract customers and be competitive with other sports such as basketball, baseball and football, and theme parks, which frequently receive state and local tax subsidies. The Congressionally approved tax break is seen an equalizer to let auto racing enjoy similar tax advantages.
In the recent Fiscal Cliff bill, Congress has provided these NASCAR motor raceway businesses with a continuation of a 7-year accelerated depreciation schedule through 2013 – billed as a “job creator”. This allows motor raceway businesses to “write off” or pay less taxes than if their investment was depreciated over the more normal 15 to 25 years as with most business investments. This depreciation was first approved in 2004 in the Jobs Creation Act and has continued to be extended in fiscal bills since then. The recent extension is estimated to result in $70 million less revenues in the next two years and $35 million less from 2015 – 2019.
Admittedly the cost of this tax law extension to benefit the auto racetrack owners is small. Nevertheless, this action was approved while Congress supposedly is
looking to close loopholes and shave spending on a very broad scale affecting
almost every aspect of people’s lives and are not able to agree on any of it. There must be a lot of car racing fans in Congress.