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RE: Tax exemption for environmental equipment



I am curious about this whole concept.  Does anyone have evidence that a tax
exemption for enviro equipment, or P2 technologies, really causes a
reasonable number of companies (as in, more than 2 or 3), to actually make
the investments that they would not make otherwise?  The benefits of the tax
exemptions are not very significant compared to the whole cost, and the
obstacles to investing in such equipment are significant and well known.
Considering how much effort is needed simply to get a tax exemption like
this in place and to implement it (with the review process for applicatoins
etc), unless a LOT of companies are inspired to make investments that they
would really not make otherwise (which is of course hard to demonstrate), I
wonder if tax exemptions really make any difference.  The whole idea of
market based mechanisms is that they move the market, not just one or two
firms who would make the investment anyway and figure they can make a little
extra money via the tax credit.  Does anyone have any data that shows how
many  firms  made new investments in P2 or PC, stimulated by these tax
credits?  Without such evidence, I am disinclined to believe that they are
worth the effort.  And yes, I have already had my coffee so I am not just
being cranky this morning.

Burton Hamner, MBA, MMA
Professor, Universidad de Pacifico
Avenida Salaverry 2020
Jesus Maria, Lima 11, Peru
511-219-0100, x2354
fax 511-219-0135
email wbhamner@cleanerproduction.com
web http://www.cleanerproduction.com




-----Mensaje original-----
De: owner-p2tech@great-lakes.net [mailto:owner-p2tech@great-lakes.net]En
nombre de Sobin Rodney
Enviado el: Miércoles, 17 de Septiembre de 2003 08:49 a.m.
Para: Tammy Allen; p2tech@great-lakes.net
Asunto: RE: Tax exemption for environmental equipment


Tammy--

It may be a bit out-of-date but back in '95 we put together a list of
federal tax provisions that encourage innovative technologies.  The list is
in U.S. Congress, Office of Technology Assessment, Innovation and
Commercialization of Emerging Technologies ,OTA-BP-ITC-165, September 1995
on page 93.  The report is available via the OTA archives at
http://www.wws.princeton.edu/~ota/   I've also appended an image of the
table below but the image quality is not too good.

Many of the provisions were/are energy related.  Again, be careful because
the list is old so it may be worth looking at the US Code citations to see
if they're still in force.  I'm not aware of any special credit or deduction
at the federal level that would apply to purchase or installation of
pollution prevention processes or pollution control equipment.

In case you're interested, in Virginia there are some state tax credits and
exemptions--sales tax exemption for pollution control equipment; income tax
credits for recycling equipment, oil burning equipment, and for certain
pollution control and disposal equipment. ... Not exactly the vanguard of P2
policy is it?
See http://www.deq.state.va.us/waste/ and click on "Tax Credit" on the lower
left part of the page

I hope this is useful.

Rod

Rodney Sobin
Air Permitting Program Coordinator
Virginia Department of Environmental Quality
Postal: P.O. Box 10009, Richmond, VA 23240-0009
Street:  629 E. Main St., Richmond, VA 23233-2429
Tel. 804-698-4382	fax 804-698-4264  Rsobin@deq.state.va.us
DEQ Innovative Technology http://www.deq.state.va.us/innovtech
Chesapeake Bay Program Innovative Technology
http://www.chesapeakebay.net/innovative.htm
<http://www.chesapeakebay.net/innovative.html>
Virginia Environmental Services Network http://www.vesn.org




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