“ So the look of it is that the tax code is favoring companies that are established and survive, which doesn’t seem like so bad of a thing.”
To me that is quite a flippant statement; barriers to entrepreneurship have significant effect of the dynamism of an economy and it’s not evident to me that it’s wise to so heavily favor big incumbents and penalize less mature businesses
> is that the tax code is favoring companies that are established and survive
Or to rephrase that, it is favouring existing big corporations and further limiting competition and access to market for regular folks. It's straight far right economic model where big corporations have the whole cake and the proles become wage slaves without ability to go their own way.
Support of such thing is delusional.
On a five-year time frame, section 174 is equivalent to the existing tax code. You have five years of labor expense, and after five years 100% of it is amortized from a cumulative point of view. So the look of it is that the tax code is favoring companies that are established and survive, which doesn’t seem like so bad of a thing. If your start up is operating at a loss and you don’t have the capital to afford taxes while you’re operating at a loss, It’s a harder road to climb. So from an economic stability point of view, it makes sense to me that you would want startup companies to be well funded and for them to have a business model that doesn’t rely on a tax loophole to cannibalize existing aspects of your economy.
The foreign labor deduction Requiring 15 years of amortization versus five years for local labor is an interesting one too. That is a very clear shot at offshoring and I’d guess is the reason this wasn’t proactively revised.
Most of the analysis is “look at my million dollar ARR business and how bad it is now” but without a time component, that’s a disingenuous take.