AT&T and Verizon gobble up tax breaks but don’t produce more jobs

With Congress poised to extend a raft of tax breaks, consider this: One such break has helped AT&T Inc. and Verizon Communications Inc. slash their recent tax bills by billions of dollars without leading to the intended increase in investment or jobs. The measure, known as “bonus depreciation,” lets companies offset their income with investments they have made more quickly. It was enacted in 2008 as part of the economic stimulus package with the goal of giving companies an incentive to build more factories or upgrade more equipment, creating jobs and giving a boost to sluggish economic growth in the process. But that isn’t how it has worked, at least at AT&T and Verizon, whose vast networks of towers and cables make them two of the country’s biggest investors in infrastructure. AT&T estimated its federal tax bill last year at $3 billion, down from about $5.9 billion in 2007, before the tax relief was enacted. Verizon estimated that it would get $197 million back last year, compared with a 2007 bill of $2.6 billion.