PHCC Meets with the White House on the Administration's Tax Reform Framework
Earlier this week, PHCC met with White House policy staff to discuss the Administration's recently released Tax Reform Framework, which includes provisions that are favorable to small businesses. The Administration requested to meet with PHCC as part of an effort to better understand how the tax reform framework potentially affects contractors.
This meeting comes on the heels of a previous meeting the White House held with PHCC and the American Supply Association regarding apprenticeships and workforce development.
As Congress continues to consider a comprehensive tax reform package, President Trump in concert and coordination with his Cabinet members, has begun a campaign to promote the framework on the local level including town hall meetings, media opportunities, and similar events throughout the country. These events would be attended by President Trump or a member of his Cabinet.
“We are very pleased that PHCC has established a seat at the table with the White House – and as important, a voice with the Administration. Our National efforts continue to advance and provide meaningful dialogue that may have a very positive impact on the entire industry. What PHCC members need to understand is that the Administration is looking to partner with PHCC as a valuable resource to understand how the Administration’s policies impact the industry.”
Laurie Crigler – PHCC National President
During the meeting, White House staff discussed the potential for PHCC to provide information and stories from PHCC member contractors regarding the business benefits of tax reform and to possibly attend the events under consideration – with perhaps the opportunity for members to participate at the events.
PHCC may be in contact with PHCC state associations and members soon to provide first-hand information across the country on the tax reform proposal. This would be coordinated with an event and attended by an official from the Administration. In addition, the White House has also asked PHCC to provide a list of state events that are planned throughout the rest of this year and possibly 2018, so they can understand any potential opportunities.
PHCC's Message on the Tax Reform Framework
Cap Shareholder Pass-Through Income PHCC members are typically small businesses, many with 20 employees or less. It is common for these businesses to be some form of pass-through entities such as Sub-Chapter S Corporations. It is also not uncommon that the income passes through on paper without the shareholder receiving the actual money, yet the tax liability attached to that must be paid with actual money. The change to cap shareholder pass-through income at 25% is a welcome provision which allows greater re-investment in business operations.
Corporate Tax Deduction While many of the PHCC members are small businesses, our membership has larger organizations structured as C Corporations as well. The reduction of the corporate tax stops siphoning off revenue that could expand employment, purchase tooling and equipment or provide job training programs.
Expensing of Capital Acquisitions In conjunction with the income tax revisions for C Corps and S type Corps, the change toexpensing of capital acquisitions provides significant incentive to invest in the business. This provision allows our contractors to offset the addition of new vehicles and major tooling, key components in putting plumbers to work.
Late-Breaking Story on Tax Reform
The House passed a budget resolution Oct. 26 – that in essence, clears the way for Congress to move on tax reform.
The bill was passed despite some opposition over a plan to eliminate the State And Local Tax (SALT) deduction in the tax reform framework.
The budget includes reconciliation rules that will allow the Senate to consider and pass tax reform with only a simple majority - rather than 60 votes to overcome a filibuster.
Simplification PHCC further supports the simplification of the myriad of deductions and program formulations which make the tax system burdensome to small business. For many businesses, tax time takes many hours of an owner’s time to assemble documentation, prepare reports, and to meet with tax specialists. Productive time is lost and significant expense is incurred for this process, reducing the complexity allows time and capital to be focused on business growth.
Elimination of Alternative Minimum Tax Calcuations On the personal tax side, complications will be reduced as well. Calculations for the Alternative Minimum Tax will be eliminated, a calculation usually done to show the contractor didn’t owe it in the first place.
Elimination of the Death Tax Lastly, PHCC supports the elimination of the death tax. Many of our contractor members share concern for their exposure to this. For a good portion, the applicability may not exist but they again have hired experts to navigate the complexities.
Register for BNP Webinar Featuring White & Riso!
PHCC’s own Vice President of Regulatory Affairs Chuck White and Vice President of Legislative Affairs Mark Riso will present a webinar on “How High Performance Plumbing Can Help Your Business” at 2 p.m. EST Nov. 2. The free webinar is being produced by Business News Publishing and is sponsored by Gerber. In addition to learning about high performance plumbing, you’ll also be eligible for a drawing to win Gerber’s new efficiency Viper® toilet!
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