Industry representatives Wednesday criticized a provision in the Clinton administration's 1998 budget proposal to limit tax writeoffs for operating losses.
Speaking at a House Ways and Means Committee hearing for the American Bankers Association, Wells Fargo Bank senior vice president Richard A. Hayes said the administration's plan would have an "adverse impact on bank regulatory capital."
Current law allows a loss to offset taxes paid in the previous three years. Banks are allowed to include any unused portion of the offset in their regulatory capital as a "deferred tax asset."
The White House has proposed cutting to just one year the period for which a company can receive a refund on previously paid taxes.