Fri, Nov 20 2009
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Published November 13, 2008 10:33 pm - Sen. Christopher “Kit” Bond on Thursday said he plans to introduce legislation that would make interest on car loans tax-deductible to help revive auto sales, while debate swirled on a separate proposal for a $25 billion loan for the country’s ailing automakers. Sen. Bond to propose tax incentives for auto buyers By Derek Spellman
dspellman@joplinglobe.com Sen. Christopher “Kit” Bond on Thursday said he plans to introduce legislation that would make interest on car loans tax-deductible to help revive auto sales, while debate swirled on a separate proposal for a $25 billion loan for the country’s ailing automakers. The proposal to be sponsored by Bond, R-Mo., and Sen. Barbara Mikulski, D-Md., would make interest payments on car loans, along with sales taxes or excise taxes, deductible for new cars purchased from Nov. 12, 2008, to Dec. 31, 2009, according to a statement released by Bond’s office. The senators plan to introduce the proposal next week as part of a broader stimulus package Congress will consider during a postelection session beginning Monday. Bond said in the statement that the bipartisan measure would “provide the temporary and targeted assistance needed to boost auto sales which will help save American jobs, help middle class families and support the auto industry.” The deduction would apply to loans up to $49,500, and would be phased out for families making more than $250,000 and individuals making more than $125,000. Bond’s office estimated that a family would save about $1,553 on a $25,000 vehicle. Bond’s proposal came as Democrats try to enlist support for a separate plan that would pump $25 billion in emergency loans to U.S. automakers in exchange for a government ownership stake in Detroit’s car companies. Rep. Barney Frank, D-Mass., chairman of the House Financial Services Committee, and Sen. Carl Levin, D-Mich., are developing legislation that would let the auto industry tap into the $700 billion Wall Street rescue money, approved by Congress last month, to fund their business operations. General Motors Corp., Ford Motor Co. and Chrysler LLC are lobbying Congress to approve the aid, citing an economic downturn that has choked off auto sales, frozen credit and made them vulnerable. GM, the nation’s largest automaker, posted a $2.5 billion quarterly loss last week and has predicted that it could run out of cash by the end of the year without government help. Asked for a reaction to the $25 billion loan proposal, Bond said, “While I have real concerns with another taxpayer-funded bailout, there are also thousands of workers in Missouri whose jobs are on the line, so the devil will be in the details.” Rep. Roy Blunt, a Republican who represents the 7th District of Missouri, said he would be “really hesitant” to use money from the $700 billion rescue package for a loan to the automakers. The “real purpose of the previous (package) was to make credit available to” families so they can purchase homes, students so they can get loans for college, and small businesses so they can meet their needs, he said. Blunt said he shared some of the same sentiments as Treasury Secretary Henry Paulson. Paulson on Wednesday said the auto sector was “critical,” but that the financial industry rescue was not designed for car companies. “Any solution has got to be leading to long-term viability” for auto companies, Paulson said. Missouri presence Although the three automotive giants are based in the Detroit area, the automakers have a comparatively strong presence in Missouri. 
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