AED has long championed, both in Washington, D.C. and Ottawa, a pro-growth tax code that incentivizes capital investment and job creation. In 2017, with the passage of the Tax Cuts and Jobs Act, due to AED’s advocacy and member engagement in the legislative process, many of AED’s tax policy goals were achieved. Since the law’s enactment, the association has been active in telling the story of its positive impact on equipment dealers, and as importantly, your manufacturers and your customers. Indeed, among AED’s top priorities is permanently extending many of the key provisions we sought in the law, including 100 percent bonus depreciation, the 199A pass-through deduction and the deductibility of business interested tied to EBIDTA.
Unfortunately, the hard-fought progress to reform the tax code is at-risk as the Democratic majority in Congress pursues its reconciliation bill that will spend trillions of dollars to expand the government’s role in addressing climate change, healthcare and education (“human infrastructure”). To pay for the proposal, the legislation’s drafters are targeting tax increases on the business community.
Detrimental provisions include increased corporate, individual, and capital gains rates, reversing the Tax Cuts & Jobs Act’s pro-growth estate tax laws and modifying taxation of partnerships. With few exceptions, AED takes the position that tax increases stifle economic growth and capital investment. However, it’s particularly ill-advised to raise taxes on job creators amid a fragile economic recovery and a global pandemic. When you add supply chain challenges, workforce shortages and inflation concerns, tax increases are absolutely misguided.
The good news is that the Democratic caucus isn’t united on many aspects of the legislation, including overall spending levels and how to pay for it. Consequently, there’s an opportunity to modify or defeat these proposals. AED, working with the broader business community, is conveying the detrimental impact tax increases will have on the economy and our companies. Nonetheless, we can’t win this battle alone.
AED needs all our members to reach out to their elected officials to explain the impact that the proposals will have on their businesses. Whether it’s attending the Washington Fly-In on Oct. 25-27, hosting your lawmakers at your facility, responding to AED’s call to action or contributing to AED PAC, there are many ways AED members can fight these growth suffocating provisions and ensure the association is successful in Washington, D.C.
There’s too much at stake to not be involved and engage in the legislative process on behalf of your company and the broader industry.