Congressional efforts to write major tax reform legislation for the first time in 30 years was unveiled today with the release of the TAX REFORM “Unified Framework for Fixing our Broken Tax Code.”
Calling it an important first-step, Michigan Farm Bureau (MFB) President Carl Bednarski, a Tuscola County farmer, said comprehensive tax reform is essential to addressing current financial challenges plaguing many Michigan farmers across almost all commodity sectors.
“With the high-risk nature of agriculture being so dependent upon unpredictable weather, fluctuating trade policies, volatile commodity prices and large upfront input costs, anything we can do to provide farmers long-term certainty, from a tax-reform standpoint is significant,” Bednarski said.
“A tax-reform framework that ultimately results in a fair and equitable tax system that encourages savings, investment and entrepreneurship are all vital ingredients to a successful and sustainable farm operation.”
Bednarski said Michigan Farm Bureau looks forward to working with Michigan’s Congressional delegation to refine the proposal to ensure that tax reform efforts ultimately results in lower effective tax rates. “We’re encouraged to see that this framework includes important principles such as lower tax rates for individuals who own businesses, elimination of the death tax and interest deductibility,” he said.
MFB National Legislative Counsel, John Kran said the tax reform framework is the result of negotiations between House and Senate leadership and the White House.
“While that is potentially good news, the House Ways and Means Committee has indicated that additional details will not be available until after passage of the FY-18 budget resolution,” he said.
According to Kran, the reconciliation instructions contained in the FY-2018 budget will set budget targets for tax reform and will ultimately determine if, and to what extent, tax reform will be revenue neutral. He said MFB will be working with Congress to ensure that meaningful reforms for agriculture are included in any comprehensive tax package.“Farmers need permanent tax provisions like the continuation of cash accounting and lower capital gains taxes,” Kran said. “Agriculture is a high-risk, high-input, capital-intensive business and these provisions are essential for a successful agriculture.”