ICYMI: Treasury Sec. Bessent Endorses Accelerated Depreciations to Boost American Manufacturing

Will Mitola  |   April 16, 2025

Washington, D.C. – In case you missed it, U.S. Treasury Secretary Scott Bessent endorsed a proposal to include accelerated depreciation schedules for the construction of factories as part of reconciliation to boost manufacturing in the United States. Club for Growth strongly supports neutral cost recovery, a policy that would allow American businesses to accelerate depreciation schedules and account for both inflation and the time value of money when investing in structures like factories. Politico covered the development in its Morning Tax newsletter.

 

“Club for Growth applauds Secretary Bessent for prioritizing this pro-growth policy. Accelerated depreciation of structures will eliminate the current tax code’s penalty on new capital investment and help ensure American manufacturers can compete globally,” said Club for Growth President David McIntosh. “We look forward to working with the Administration and Congress to secure neutral tax treatment for structures and end this artificial tax on investment.”

This pro-growth reform was featured in the Club for Growth Foundation’s Freedom Forward Policy Handbook – a comprehensive set of free-market, limited-government proposals aimed at boosting industrial investment in the United states. Club for Growth President David McIntosh highlighted the importance of this policy in a December op-ed “Neutral Cost Recovery Could Be Trump’s Best Tax Cut.”

  • Click here to read the full coverage from Politico.
  • Click here to read Club for Growth President David McIntosh’s full op-ed in The Washington Times.
  • Click here to read the full analysis from the Club for Growth Foundation.

 

POLITICO EXCERPTS:

BESSENT’S TAX PROPOSAL: The Trump administration has a lot of ideas for its big, beautiful bill, and add one more: expanded writeoffs for building factories. It wants to include accelerated depreciation breaks for the construction of factories as part of Republicans’ tax legislation this year.

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It’s unclear if the idea might be a substitute for Trump’s campaign proposal to offer a cut-rate 15 percent corporate tax on domestic manufacturers.

“The secretary is pushing that there be accelerated depreciation for the construction of factories,” said Faulkender, referring to Treasury Secretary Scott Bessent. “We’ve very much interested in ensuing that this tax plan not only preclude the tax increase on the American people but also have additional pro-growth incentives.”

That would go beyond restoring so-called expensing, which Republicans also want to include. Structures generally don’t qualify for accelerated depreciation, and policymakers may have to define what they mean by a factory so that, say, a restaurant wouldn’t qualify.

But Kyle Pomerleau of the American Enterprise Institute says the idea would be better than reducing rates on domestic manufacturers, a proposal he says would be far more complicated and not very cost efficient.