July 9, 2020

Washington Wire: Final Tax Bill Passes Congress


Final Tax Bill Passes Congress  

In a major lobbying victory for One Voice, on December 20, 2017, the House and Senate sent to the President for his signature a bill to significantly change the U.S. tax code for the first time in over 30 years. Thanks to the efforts of One Voice members, who for many years sought lower rates and stronger investment provisions, this is a major change not seen in decades.
While no stakeholders secured everything they wanted, policymakers heard our calls to create a code that incentivizes domestic manufacturing. Small and medium-sized manufacturers who invest heavily in equipment in particular stand to benefit from many of the bill’s provisions. Although disappointed that State and Local Tax deductions are not treated more fairly in the final bill and many provisions are temporary, this legislation remains a landmark step for One Voice members, who have made it clear that tax reform is a top priority. 
Key provisions in the bill include: 
  • Corporate rate of 21%, effective January 1, 2018 
  • Top individual rate of 37%, with 20% deduction for business earnings of pass-throughs 
  • No corporate alternative minimum tax 
  • Full 100% business expensing for five years 
  • Section 179 Equipment Expensing at $1 million 
  • Business interest deductibility up to 30% of modified income 
  • Maintains R&D tax credit 
  • Doubles Estate Tax exemption to $11 million per individual, $22m per couple 
  • Keeps current Section 127 employer education assistance 
  • Repatriation of 15% rate for cash and 8% rate for earnings reinvested in hard assets, with an 8-year window to pay the tax
While we will continue to fight and advocate for additional improvements moving forward, the passage of the Tax Cuts and Jobs Act is an important and historic step in the right direction.



EPA Sued Over Omitting Nonattainment Findings; Will Seek Replacement of CPP
On December 19, a judge ruled the EPA has until January 12, 2018 to determine whether each county in the country is in attainment of the lower pollution standards. In the first full week of December, fourteen attorney generals sued EPA for not disclosing its Ground Level Ozone National Ambient Air Quality Standards (NAAQs) findings by October 1, as required by statute. The suit wants EPA to designate the areas of the United States not in compliance with the Obama-era rule. In early November, EPA published a partial report, listing the 85% of counties in the United States in compliance/attainment and leaving out the 15% remaining counties in nonattainment. At the time, the agency stated it would list the nonattainment counties “in a separate future action.” As mentioned in a previous Washington Wire, “this leaves a number of counties with hundreds of One Voice members still in limbo including Cuyahoga in Ohio, Cook in Illinois, several in Pennsylvania and virtually all of California where only six of fifty-eight counties achieved attainment status.”
In addition, on Monday, December 18, the EPA announced it is seeking formal public input on ways to replace the Obama Clean Power Plan (CPP). By the EPA’s own admission at the time, the CPP, which the Supreme Court has put on hold, would increase the price of electricity annually by 6-20%. This comes as a relief to One Voice member companies who had been voicing concerns that, while they supported removing the CPP, they were nevertheless apprehensive of being exposed to future litigation without the shield of a replacement rule. Sources expect the agency to issue a more business friendly proposed replacement rule by the end of the coming summer.



House Committee Finishes Markups on PROSPER Act
House Committee Finishes Markups on PROSPER Act Late in the evening of December 12, the House Education and Workforce Committee finished markup of the “Promoting Real Opportunity, Success, and Prosperity through Education Reform Act” (PROSPER Act). The PROSPER Act represents the first attempt by Congress to reauthorize the Higher Education Act since 2008. The bill passed by party line vote of 23-17 and now moves to the House floor for consideration.
The main focus of the bill is on streamlining the student financial aid system by proposing one grant, one loan, and one work-study program with uniform repayment options for all students. Of interest to One Voice members, the bill intends to create an Apprenticeship Grants program concentrated on partnerships between businesses and institutions. It also offers Pell Grants for students who are pursuing short-term, certificate or vocational courses. Although it passed committee, the PROSPER Act still faces challenges with no Democratic support and it eliminates programs like Public Service Loan Forgiveness, which benefit GOP constituents in rural districts. A related Senate bill is expected in early 2018.



NLRB Overturns Browning-Ferris; Seeks Comments on Ambush Elections Rule
On December 15, the National Labor Relations Board (NLRB) overruled its 2015 Browning-Ferris decision by 3-2 vote. The Browning-Ferris decision extremely enlarged the definition of joint employer to include businesses that exercise “indirect control” over working conditions of another company’s employees, even if they merely reserve the right to do so. This action also affected manufacturers using temporary workers. Having overturned Browning-Ferris, NLRB stated, “two or more entities will be deemed joint employers if there is proof that one entity has exercised control over essential employment terms of another entity’s employees and has done so directly and immediately in a manner that is not limited and routine.” In addition to overruling Browning-Ferris, NLRB also published a request for comments on whether it should change or outright revoke its representation election rule, also known as the Ambush Elections rule. Comments are due by February 12, 2018. One Voice has opposed the Ambush Election rule since its inception and will be submitting comments.



Commerce Secretary Self-Initiates Aluminum Sheet Duty Case Against China
On December 5, for the first time in over 25 years, U.S. Secretary of Commerce Wilbur Ross announced self-initiated antidumping duty (AD) and countervailing duty (CVD) investigations of imports of common alloy aluminum sheet (common alloy sheet) from the People’s Republic of China (China). Although rare, the Secretary has the authority to self-initiate AD/CVD investigations under the Tariff Act of 1930, as amended. Once initiated, the U.S. International Trade Commission (ITC) has 45 days to make preliminary injury determinations to the domestic common alloy sheet industry. Assuming it finds injury to domestic industry, ITC will be scheduled to announce its preliminary CVD determination in February 2018 and its preliminary AD determination in April 2018. If you are an affected PMA or NTMA member and would like to discuss more please contact: info@metalworkingadvocate.org.