Last week, AEM and CLAAS of America welcomed members of the House Ways and Means Committee’s Rural America Tax Team to Omaha for a discussion about how to further improve the policies from the Tax Cuts and Jobs Act.
The group of lawmakers, led by Representative Adrian Smith (R-Neb.), who chairs the Rural America Tax Team, toured the 183,000-square-foot production facility, where CLAAS builds its LEXION combine harvester, met with AEM and CLAAS executives, and participated in a roundtable with dealers and farmers.
Representative Smith was joined by Representatives Don Bacon (R-Neb.), Randy Feenstra (R-Iowa), Mike Flood (R-Neb.), and Nicole Malliotakis (R-N.Y.).
“The world depends on a strong American agriculture industry, and American producers depend on reliable, growing equipment suppliers,” said Representative Smith. “This is why I continue to support increasing the cap on deductible business interest. I was grateful for the chance to hear directly from manufacturers on how TCJA improvements to Sec. 179 and bonus depreciation increased American productivity and competitiveness for equipment manufacturers and their customers.”
During the roundtable discussion, AEM and CLAAS stressed the importance of restoring strong incentives for research and development expenditures, while distributors and farmers outlined how the phaseout of bonus depreciation and the expiration of the federal estate tax exemption will have dire consequences for rural communities across the country.
“We very much appreciate the opportunity to host Representative Smith and the other elected officials who came out to tour our facility, speak with our dedicated employees, and learn how the production of CLAAS agricultural equipment contributes to Nebraskans’ efforts to help feed the world while enabling farmers to be the best in their field,” said Eric Raby, Senior Vice President of Region Americas for CLAAS.
The Tax Cuts and Jobs Act was a once-in-a-generation achievement that strengthened the U.S. economy, created more family-sustaining jobs, and bolstered America’s global competitiveness. The economic damage to equipment manufacturers and rural communities will be severe if Congress does not act to prevent essential pro-growth tax policies from expiring in 2025.
“The Association of Equipment Manufacturers greatly appreciates Representative Smith and the House Ways and Means Rural America Tax Team for sitting down with equipment manufacturers, distributors, and customers to discuss how we can ensure that the tax code not only supports growth and innovation in the equipment manufacturing industry but also reflects the unique challenges facing rural America,” said Kip Eideberg, senior vice Ppesident of government and industry relations.”
AEM also used the field hearing to highlight equipment manufacturers’ top tax priorities for members of the Rural America Tax Team, discussing why preserving pro-growth tax policy is vital for equipment manufacturers in the United States. Specifically, equipment manufacturers are calling on Congress to preserve the 21% corporate tax rate, make the pass-through deduction permanent, restore immediate R&D expensing, and protect family-owned equipment manufacturers by preserving the increased exemption threshold or by eliminating the estate tax altogether.
“The Tax Cut and Jobs Act helped many small businesses expand their businesses, create more jobs, and invest in new equipment for the first time in years, enabling them to modernize their operations and make them more efficient,” said Rep. Malliotakis (R-N.Y.). “As many of these provisions like Bonus Depreciation, Interest Deductibility and Research and Development have expired or begun to sunset, it’s critical we convince our colleagues in Washington to extend and improve them. I was happy to join the Association of Equipment Manufacturers to tour CLAAS’ facility and see the jobs created and innovation fostered first-hand.”
“With the expiration of the Tax Cuts and Jobs Act quickly approaching, we must ensure that our businesses and manufacturers continue to benefit from important pro-growth tax provisions. It’s why hearing from CLAAS employees and leadership about the importance of policies like immediate R&D expensing was important and insightful,” said Rep. Feenstra (R-Iowa). “Making 100% R&D expensing permanent will help us compete with China, which provides its manufacturers and businesses with a 175% R&D expensing deduction. For the sake of our economic growth and competitive edge, any rewrite of the tax code must include the permanent use of immediate R&D expensing for American manufacturers and businesses.”
AEM appreciates the thoughtful consideration that the Rural America Tax Team is giving to how the tax code impacts equipment manufacturers, dealers and customers, as well as rural communities across the country.
For more AEM news and updates, subscribe to the AEM Industry Advisor.
