The private equity industry is working to change the way taxes are tallied for indebted businesses in hopes of increasing tax deductions, according to Financial Advisor.
By adding DA (depreciation and amortization) to an earnings formula to calculate tax deductions, billions could be saved. It would increase deductions for companies, therefore increasing profits.
Any firm that has borrowed money could benefit from this change. With many businesses relying on debt to finance expenses, there is strong support for this change. Lobbying from firms such as the American Investment Council and the National Association of Manufacturers are pushing the issue to gain congressional support.
