President Carter's proposal yesterday for a refundable investment tax credit would amount to a cash subsidy for business.

Because of fears the proposal would set a precedent for other cash refund programs, the president's tax plan is likely to run into considerable opposition in Congress.

Currently, investment tax credits, along with other tax incentives aimed at encouraging business investment, by definition can help only companies which are profitable enough to pay taxes. But the object of such incentives generally is to reduce the cost of new assets for any company which will buy them, irrespective of the tax liability or profitability of the company.

There is thus a logical argument for Carter's proposal to make investment tax credits partially refundable to companies which cannot use them as an offset against their tax bills because they have no tax liability.

Carter's measure would allow companies who invest, but have no current-year tax liability, to claim up to 30 percent of their tax credit as a cash refund from the government. They may then carry forward (or back) the remainder of the tax credit to write against taxes in years when they do have a liability.

There is bound to be considerable political opposition to them, however, as well as opposition from some economists. There are powerful congressional interests against the concept of tax credits because they are seen as an addition to federal spending rather than as a part of a tax system.

Since 1975, when the earned income tax credit for low-income working parents was made refundable, the Senate Finance Committee has attempted to make some energy tax credits refundable. All but one of the attempts failed. The one success -- on solar and wind energy credits -- was later dropped.

Another of yesterday's proposals on business taxes -- for a new "targeted" investment credit, which would be fully refundable -- is similar to one put forward by Carter two years ago. The new credit would be payable to industries investing in high umemployment areas, with credits allocated by the Commerce Department up to a total of $1 billion in each year.

Congressional sources yesterday said the 1978 proposal for a targeted ITC scarcely had been considered seriously by Congress. They commented that they were powerful forces both for and against refundability.

Administration officials yesterday pointed to two kinds of businesses which would benefit from the refundable ability proposal. The most obvious are those in "distressed" industries such as autos or steel, which are suffering losses, or at least are not profitable enough to pay taxes at the moment, but which have large investment commitments and needs. These include companies such as Ford, which are widely thought to be viable but at present are ringing up large losses.

The other group consists of smaller, new businesses which have not yet built up profits, and therefore have no tax liabilites, and whose cash flow and ability to make new investments would be greatly helped by an immediate refund rather than a deferred credit.

The administration's proposals to aid these groups through the tax credit refund were characterized by Republican presidential candidate Ronald Reagan yesterday as "a stop to some of those industries which have been badly undercut by the economic fallout of Carter's previous new economic programs."

Some utilities also would be helped by a refundable credit.

The auto industry also would benefit from a Carter proposal to make the full 10 percent investment tax credit payable on investments that are being written off in two or more years. At present, the tax credit is fully payable only when an investment is written off over seven years or more. There is no tax credit on investments with two-year write-offs, which include many of the auto industry's capital projects.

Those with a three- or four-year life are eligible for one-third of the credit, and those with five- or six-year lives have two-thirds of the credit under current law.

The administration proposals on business taxation center around more generous depreciation measures. But they also would enhance the role of investment tax credits. These tend to help smaller, less profitable companies most.

The emphasis on tax credits was criticized yesterday by a congressional source who said that this would bias the government's investment incentives towards investment by low-income companies. Improving the depreciation provisions would lead to a more neutral system of encouraging investment, he said.