JAMESTOWN – Congressman Tom Reed (R-Corning, NY 23) was in Jamestown Friday to push for the GOP-sponsored Corporate Tax Reform plan that will soon be taken up in the House.
Reed was in Jamestown to meet with local business leaders and elected officials and discuss the GOP Tax Reform plan and what impact it would have on the local economy.
The meeting took place at Jamestown Electro-Plating Works on Water Street. Reed said that after more than 30 years of using the same tax code, it’s time to update it and make it more fair for businesses.
“What we’re trying to do is to promote a tax policy that rewards making things in America and encourages making things in America so that we can sell them around the world,” Reed said. “And also make sure that when we sell products internally to the U.S. by our U.S. manufacturers, that they are on an even playing field with the foreign competitors that they find themselves facing each and every day.”
Reed said the tax reform package being promoted by Republicans will reduce federal tax rates for businesses, while also allowing the cost of capital investment to fully and immediately deductible, rather than being subject to depreciation deductions that take place over time. The plan includes other aspects as well, and Reed said that all reforms would be equally important and necessary to help businesses succeed.
“They all go hand-in-hand,” Reed said. “Lowering the rate is obviously where we start the conversation, but as I’ve studied the tax code, and as most people will tell you, just getting one doesn’t take care of the problem. You need to get all of it. So we need to look at all the tools as critical components of the entire package, and that’s what we’re going to continue to fight for as we go forward.”
Joining Reed was Chautauqua County Industrial Development Agency Finance Director Richard Dixon, who said the reforms could go a long way in helping local businesses compete on the international stage.
“From Ripley to Silver Creek to Jamestown, when I’m visiting businesses I hear ‘tax, tax, tax,'” Dixon said. “The three things I was encouraged about today was lowering the lowering of the corporate tax rate, eliminating the depreciation, and letting companies deduct their capitol investments in the year they acquire them. That will go a long way in letting people invest in capitol investment and putting a stake in the ground here in Chautauqua County.”
The GOP reform plan would likely reduce corporate rates from 39 percent to 20 percent or even 15 percent. The tax reform effort to favor business is also picking up support across the aisle, with some Democrats in Congress, as part of the so-called “Problem Solvers’ Caucus,” voicing support for reform.
One of the criticisms of the GOP proposal is that it would effectively eliminate corporate taxes, putting them on the same level as individuals and small businesses. As a result, highly successful corporations that already operate effectively under the current system would see an even larger profit margin, with many fearing the profits would go to shareholders and top corporate officials, with little being invested to create new jobs or better paying ones.
The Federal Tax policy was last updated in 1986 and President Donald Trump has said it is a top priority for his administration.