ACG Submits Tax Reform Comment Letter to House Ways and Means Committee

ACG recommended a “simpler and fairer tax environment for middle-market businesses” in a recent letter submitted to the House Ways and Means Committee.

Entitled “How Tax Reform Will Grow Our Economy and Create Jobs,” the letter was presented on May 18 at what was likely the first in a series of hearings to address corporate tax reform.

With the passage of the American Health Care Act of 2017 (the ACA ‘repeal and replace’) by the House, Congressional representatives have now pivoted to tax reform. Rep. Kevin Brady, a Texas Republican and House Ways and Means Chairman; and House Speaker Paul Ryan, a Wisconsin Republican, have both stated that tax reform will occur in 2017, despite increasing consensus among experts that any new legislation is unlikely to pass until at least early 2018.

This letter submission provided an opportunity to concisely summarize and update the committee on the interests, membership and policy objectives of the Association for Corporate Growth, as well as dispel some of the myths surrounding the replacement of the tax deduction of interest paid on corporate debt with full and immediate expensing of capital expenditures.

“If a corporation cannot afford a piece of equipment in the first place, the ability to fully expense the piece of equipment will provide no material benefit or incentive to expand one’s company,” said the letter, adding that “75 percent of startups use some sort of debt financing at inception, and four in five small businesses use some form of debt in their capital structure.^[1]”