Industry Cheers Congressional Action on Tax Reform
Retail industry groups praised the U.S. House of Representatives’ passage this week of the Tax Cuts and Jobs Act by a 227-205 margin, with 13 House Republicans joining all Democrats to vote against the long-awaited tax reform bill, which has now moved to the Senate for consideration.
“This goes a long way toward passing tax reform by the end of the year,” said Matthew Shay, president and CEO of the Washington, D.C.-based National Retail Federation. “We look forward to seeing the Senate move just as fast. Tax reform means more jobs, more competitiveness in the global economy, and more money in consumers’ pockets. That’s the boost our economy needs, and we need it today.”
Continued Shay: “As Secretary Mnuchin said this week, tax reform is all about economic growth. As Congress works to get tax reform onto the president’s desk, we must keep up this momentum and let the details get worked out as the legislation progresses. Workable tax reform that can be signed into law is more important than perfect tax reform that can’t be passed.”
In response to the Senate Finance Committee's subsequent passage of the Tax Cuts and Jobs Act, with a vote by the full Senate expected after Thanksgiving, Shay noted: “With this pro-growth measure now approved by committee, we urge senators to spend the Thanksgiving break building consensus on how to pass tax reform and to set aside any differences that might keep this vitally important goal from becoming reality. Tax reform is the key to increased prosperity that small businesses, large employers and middle-class workers have all been waiting for for more than a generation. This is about jobs, wages and America’s future.”
“We are thankful the House moved swiftly to pass this important legislation that will give America’s retailers and consumers a break,” said Jennifer Safavian, EVP of government affairs for the Arlington, Va.-based Retail Industry Leaders Association. “America’s current tax code is in dire need of an update. Retailers pay one of the nation’s highest effective corporate tax rates, which is why we are pleased to see the corporate tax rate permanently reduced to 20 percent. This will allow savings to be reinvested to grow, add jobs and serve customers. Further, we enthusiastically support the tax relief provided to individuals, specifically targeted to middle-class taxpayers. Tax reform that works for retailers and customers is vital to keep our economy growing.”
Safavian went on to hail the Senate Finance Committee's “leadership in moving tax reform towards the finish line. With reform that lowers rates, retailers can focus on investing in their businesses, stimulating growth, creating jobs and offering American consumers innovative customer experiences. With the holiday shopping season in full swing, we urge the Senate to quickly pass reform that works for retail and American families."
Reaction among the grocery sector was also enthusiastic, with an important caveat.
“I am extremely pleased that the House voted to pass its tax reform bill and move the process of creating a fairer and simpler tax code forward,” observed Jennifer Hatcher, chief public policy officer at Arlington-based Food Marketing Institute, which “remains committed to working with House and Senate leadership to make sure the final legislation that reaches President Trump’s desk lowers effective rates, treats all industries and business structures fairly, and helps promote job creation and economic growth.”
“[The] House vote is a major milestone towards passage of the first comprehensive tax reform legislation in more than 30 years,” said Pamela G. Bailey, president and CEO of the Washington-based Grocery Manufacturers Association. “As the largest sector of American manufacturing jobs, the food, beverage and consumer products industry urges the House and Senate to continue their push to enact tax reform that lowers tax rates for our manufacturers, helps U.S. manufacturers be competitive in global markets and reduces the tax burden for middle-class American consumers. These tax reforms will generate more U.S. jobs and greater economic growth.”
Added Bailey: “The food, beverage and consumer products industry plays a unique role in America as the single largest U.S. manufacturing sector, with 2.1 million jobs in 30,000 communities across the country. Our industry is a critical driver of the economy and touches the lives of every American family every day. Passage of tax reform would be good for families, good for workers and good for manufacturers.”
For his part, Peter J. Larkin, president and CEO of the Arlington-based National Grocers Association, which advocates for independent grocery sector, commended the bill as “another important step toward ultimately achieving tax reform,” and described itself as “pleased the bill lowers the corporate rate to 20 percent and retains many important tax provisions that drive growth in the independent supermarket industry, such as the interest expense deduction, the advertising deduction and the LIFO accounting method. In addition, permanently ending the estate tax will allow family-owned business to pass their stores to the next generation."
Larkin expressed concern, however, “regarding the treatment of pass-throughs in the bill. Recently, NGA and 85 of our member companies and allied state associations from across the country sent a letter to the House urging parity between c-corps and pass-through entities. Tax reform that precludes a large portion of American companies from taking full advantage of relief only hampers potential growth opportunities for Main Street businesses. NGA calls on the Senate to address this important issue. We remain committed to working with both the House and Senate to support a final bill that ensures all businesses can take full advantage of tax reform so they can continue to invest in their communities and create local jobs.”