Push for SUVs

Published: Saturday 15 April 2006

Dirty deal A us senate bill has proposed bigger tax cuts for small business owners who buy sports utility vehicles (suvs) for business purposes than those who buy eco-friendly hybrid cars.

Not just that. The new policy would also allow small business owners to claim depreciation on the value of their vehicles not covered by the deductions. While suv owners can claim deductions on the full depreciation of the remaining costs of their vehicles over a period of six years, owners of cars under three tonnes, can claim only us $15,535 over the same period.

Environmentalists have for long opposed the current tax deductions of up to us $25,000 given to suvs weighing three tonnes and above. While a tax credit worth only us $3,150 is given for buying a hybrid.

The us $25,000 deduction is obviously more profitable to the businessmen than the tax credit.

Activists assert that such policies encourage people to buy more and more gas guzzling monsters like the Hummer or the Ford Excursion. While small business owners say that tax breaks on suvs help their businesses and automobile manufacturing, which is a crucial part of the economy.

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