LUBBOCK, Texas – The Lubbock Chamber of Commerce has long advocated for comprehensive tax reform, and last month signed a nationwide letter to Congress along with almost 300 other state and local chambers of commerce urging comprehensive reform. It has been 31 years since Congress last passed a major overhaul of the tax code and this final bill took a major compromise from both houses of Congress.
In recent years, the Chamber advocated and settled for piecemeal fixes or tweaks, such as the Section 179 Depreciation, that are helpful to the area’s businesses and farmers, but comprehensive tax reform has been the Chamber’s ultimate goal.
Several items are in the final tax reform package the Chamber advocated for and include:
- A lower corporate tax rate. Starting in 2018, corporate income tax rate permanently lowered to 21 percent.
- An eased tax burden for small business. The bill establishes a 20 percent deduction of qualified business income from certain pass-through businesses.
- An elimination of the alternative minimum tax. The bill eliminates the corporate alternative minimum tax.
- Eliminating the bias in the current U.S. tax system against capital investment. This bill increases the section 179 expensing cap from $500,000 to $1 million. The bill also expands the definition of section 179 property eligible for this expensing. The bill also allows full and immediate expensing of short-lived capital investments through 2023.
- Small businesses continue to deduct net interest paid. Small businesses with gross receipts of less than $25 million are excluded from restrictions on their interest expenses.
“Although tax reform is done, the Chamber is still concerned about any potential harmful impacts to our small business partners,” stated Eddie McBride, Lubbock Chamber of Commerce President & CEO. “We will remain as vigilant studying the bill and implementation as we were monitoring the journey for comprehensive tax reform.”
View the U.S. Chamber of Commerce's Tax Cuts and Jobs Act Backgrounder