The supposed fiscal cliff relief that purportedly saves Americans money has become a benefactor for National Association for Stock Car Auto Racing (NASCAR). According to ABC News, a $70 million tax break from the new legislation ostensibly gives NASCAR a “7-year cost recovery period for certain motorsports racing track facilities.”
This tax credit will permit NASCAR-owned tracks to keep monies that otherwise would have ended up taxed by the federal government. Several other special interests have also been given some tax relief, including Hollywood, railroads and alternative energies (think Solyndra) to name a few. These were part of the tax credits that were expiring as part of the ‘fiscal cliff’. Considering the sport is conservative, including those that head NASCAR, it seems rather surprising that the association received these last-minute breaks from a more liberal government.
Technically, the provision allows speedways to write off their expenses over a seven-year period rather than the usual 15 to 39 years (it’s called accelerated depreciation). Of course, the $70 million in tax credits for NASCAR is dwarfed by some of the other odd breaks that the U.S. Government is offering, such as $9 billion per year for multinational manufacturers and banks (i.e. Goldman Sachs, GE and JP Morgan Chase) to defer taxes so they can be more competitive internationally. Some would argue why there are special interests receiving breaks while others aren’t but that’s for politicos to debate. The national fiscal cliff deal totaled $1 trillion overall (source – Washington Times).
As far as the Daytona Beach based NASCAR is concerned, this tax break will help their racetracks expand and compete against competition from other sports and entertainment facilities. These credit renewals or tax-extenders are for one year.
So, while taxes will go up on a vast majority of American citizens (source - Bloomberg), not all will have to pay. However, to be fair and put the cost of the NASCAR credits in perspective, the President spends about a tenth of the total NASCAR tax break renewal on one single vacation to Hawaii (source – Daily Mail).