Bush Pledges Tax Relief For New ‘Gulf Opportunity Zone’

by Mike Godfrey, Tax-News.com, Washington

19 September 2005

In a prime-time televised speech delivered from the heart of the stricken city of New Orleans last week, President George W. Bush pledged a package of tax breaks and incentives to get businesses and individuals back on their feet after Hurricane Katrina in what he dubbed the "Gulf Opportunity Zone."

"Within this zone, we should provide immediate incentives for job-creating investment, tax relief for small businesses, incentives to companies that create jobs, and loans and loan guarantees for small businesses, including minority-owned enterprises, to get them up and running again," President Bush declared in a twenty minute speech from Jackson Square, in the heart of the French Quarter.

The so called "GO Zone" will double small business expensing from $100,000 to $200,000 for investments in new equipment, provide a 50 percent bonus depreciation for all businesses, and extend tax relief to the building of new structures. In addition, for evacuees, the government will start tax-free "worker recovery accounts" of up to $5,000 per person to help with education, child care and retraining.

"It is this entrepreneurship that will create jobs and opportunity and help break the cycle of poverty," said Mr Bush.

However, with more than $60 billion in federal emergency aid already approved by Congress and signed by the President, and with more federal aid likely to be forthcoming, Mr Bush cautioned that taxpayer dollars must be spent responsibly. To ensure that this is the case, the President also proposed a team of inspectors general from affected agencies reviewing all expenditures.

"Inspectors general will monitor grant and contracting actions as they occur and will deploy side-by-side with contractors to ensure they are delivering what they promised," Mr Bush stated.

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