Manufacturing leader to call for tax-reform action ahead of Trump speech

National Association of Manufacturers (NAM) Chairman David Farr on Wednesday will stress the need for action on tax reform, hours before President Trump travels to North Dakota to further his push to sell a tax overhaul.

Farr, chairman and CEO of Emerson, is expected to say in a speech at the Economic Club of New York that “now is the time for action and not just lip service and hot air from Washington, D.C.”

Trump and congressional Republicans have made a tax overhaul one of their top priorities. The president’s speech in North Dakota is one of a series of initiatives he has taken recently to sell tax reform to the public, and he also met with key administration officials and GOP lawmakers on Tuesday to discuss the issue.

The congressional tax writing committees have been tasked with crafting legislation, but so far, a tax bill hasn’t been released.

The business community has been at the forefront of pushing for tax reform, arguing that it is necessary in order to make the U.S. business climate more competitive and to boost economic growth and jobs. Some businesses have already increased investments because they expect tax legislation will be enacted.

In his speech, Farr is expected to argue that supporting the current tax code is indefensible.

“If you are defending the current tax code, then you have to defend a manufacturing worker in Ohio losing his or her job to a worker overseas,” he will say. “If you are defending the current tax code, you have to defend years and years of mediocre economic growth, stagnant wages and entire communities losing hope for future prosperity.”

Farr will also argue that an improved tax code would allow the business community to “tackle so many more of the challenges our country faces — from job creation to community development to health care to education — to a stronger, more prosperous country for all.”

The NAM has four main tax-reform priorities that Farr will stress in the speech: lowering tax rates for corporations and “pass-through” businesses whose income is taxed through the individual code; implementing a “territorial” tax system that only taxes U.S. companies’ domestic earnings; creating a “robust” system for businesses to recover the costs of their capital investments; and implementing strong tax incentives for research and development. 

Farr will call for the corporate tax rate to be lowered from 35 percent to 15 percent — a goal that Trump also shares but that others think will be challenging to achieve.

The NAM hosted an event in Washington in June where Vice President Pence and Speaker Paul Ryan (R-Wis.) both made the case for tax reform and expressed confidence that policymakers would get legislation across the finish line. Farr is planning to tell audience members to “do everything in your power to make the case for tax reform.”

“Talk to your representatives. Write opinion pieces to news outlets and letters to the editor,” he will say. “And engage with the NAM, who will continue to drive this effort and bring all our influence to bear on behalf of our industry, on behalf of our communities, and on behalf of America’s working families.”