Today the U.S. House and Senate passed an omnibus spending bill with three provisions beneficial to agriculture and supported by Farm Bureau including repeal of the nation's country-of-origin labeling requirements, permanent small business expensing, and a 5-year extension of bonus depreciation.
Repealing the nation's country-of origin labeling (COOL) requirements for beef and pork effectively prevents Canada and Mexico from assessing tariffs on American agricultural and manufactured goods.
"Repealing COOL protects farmers from the financial risk posed by the more than $1 billion in tariffs recently approved by the World Trade Organization against the United States," said John Kran, Michigan Farm Bureau's associate national legislative counsel. "This is a positive action to maintain strong relationships with two key trading partners."
The permanent section 179 small business expensing provision included in the spending bill is a highly anticipated change for farmers after several years of short-term extensions. This change allows taxpayers-in 2015 and beyond-to deduct all or part of the cost of new or used business property rather than depreciating the cost over a longer period of time.
A 5-year extension of 50 percent bonus depreciation was also included, allowing farmers to better manage cash flow, minimize tax liabilities and reduce borrowing. Language was also added to expand the deduction to vines and trees that bear fruits and nuts.
"This tax extender package gives farmers critical tools to help them reinvest in their businesses," American Farm Bureau Federation President Bob Stallman said. "Tax provisions like Section 179 small business expensing and bonus deprecation free up cash flow for farmers to put their money to work. New provisions will let our members make important upgrades that reduce costs, increase efficiency and help make their businesses sustainable for generations to come."
Noticeably absent from the spending bill: a Waters of the U.S. solution and GMO labeling fix.
Congress chose not to include provisions to stop the Environmental Protection Agency's overreaching Waters of the U.S. rule (GAO Legal Opinion: EPA violated law regarding WOTUS).
They also neglected to incorporate language to set a nationwide standard for labeling of food containing genetically modified ingredients. Failure to act will bring the heavy cost of a patchwork of state labeling mandates to farmers and consumers as early as next month. Visit our GMO labeling issue page for details.
John Kran, [email protected] or 517-679-5336