Congress must advance tax reform for manufacturers, economic growth

As Congress nears the finish line on comprehensive tax reform legislation, make no mistake: it is an acid test of our elected leaders’ commitment to supporting U.S. manufacturers, and manufacturing jobs across the United States.

Our current business tax code is broken. It’s too complex, it’s too burdensome, and it’s disadvantaging to U.S. manufacturers that have to compete every day with other businesses across the globe. The comprehensive tax reform effort now underway in Congress offers an opportunity to tilt the global business environment back toward the United States, and promises to spur manufacturing job growth.

{mosads}The priorities for equipment manufacturers for tax reform are pretty straightforward. First, tax reform needs to lower the topline rate for both traditional manufacturing businesses, as well as small and midsize manufacturers whose profits are right now currently taxed under the personal income rate. Second, tax reform needs to make it less costly and time-consuming for manufacturers to file taxes by simplifying our code. Finally, if our elected leaders really want these reforms to deliver meaningful change for our economy, they must be permanent.

The House and Senate tax bills make solid strides toward those goals, though lawmakers still must work to improve legislation for the sake of manufacturers and their customers. Congress must make sure that international manufacturers are treated fairly, and that customers and dealers are able to adequately access credit and maintain inventories.

Equipment manufacturers are taking a stand on this issue because we are a major part of our nation’s manufacturing economy. Our industry is proud to support 1.3 million jobs across the United States. Last year, we generated $159 billion in national economic growth. Our industry has identified tax reform as a major priority because of the opportunity to grow the economy and create more, good-paying manufacturing jobs.

The last time Congress rewrote our tax code was in 1986, when “Top Gun” was the biggest movie of the year and manufacturers hadn’t even begun to incorporate some of the high-tech, transformative practices that have revolutionized our industry. Our global competitors have already acted, and rewritten their own tax codes in recent years to encourage domestic manufacturing. Isn’t it time that we had a tax code that recognizes the tremendous change of the last 31 years, and positions manufacturers in the United States for a new generation of growth?

That is why equipment manufacturers are excited and supportive of the positive steps Congress has taken to pass initial legislation. Leaders in Congress would be well-served to take a cue from equipment manufacturers as they now move forward. That’s to say, our elected leaders must now be prepared to make some tough decisions to achieve a shared goal. We can’t afford for our members of Congress to take “no” for an answer when it comes to tax reform.

Let’s encourage investment and economic growth. Let’s grow our manufacturing industry. Members of Congress have a once-in-a-generation opportunity to modernize our tax code. It’s time for them to act with the courage of their convictions, and pass commonsense, comprehensive and permanent tax reform without delay.

Slater is the president of the Association of Equipment Manufacturers.