GOP, Equine Industry Canter Toward Tax Reform

October 6, 2017

The equine industry and its partners in the agriculture and small business sectors continue to engage Congress and the Administration on key elements of the GOP’s “unified framework for tax reform,” released on September 27.  While the framework outlines broad themes for reform, AHC and its partners are focusing efforts on repeal of the estate tax, also known as the “death tax,” as a pillar for a 21st century tax code.  Below are summaries of tactics used to move the legislative process forward, and highlights from conversations with congressional and administration officials. 

Congress Hears from Small Business, Agriculture:

On September 12 – two weeks prior to release of the GOP framework – AHC joined nearly 150 small business groups in a coalition letter to congressional leadership urging full repeal of the estate tax.  When the government imposes estate taxes on an equine operation, surviving family partners may be forced to sell equipment and other assets to save the family business.  Signatories represent a cross-section of American business, including builders and contractors, grocers, truckers and cattlemen.  Advocates emphasized the fact that repeal of the estate tax would not only cost the treasury relatively little revenue in the short term, but ultimately increase tax revenues by $145 billion over a ten year period.  Underscoring minimal, short-term impacts on the federal budget is crucial to moving tax reform through the budget reconciliation process, which requires Congress to demonstrate that the new and improved tax code will ultimately achieve deficit reduction.

“Budget Reconciliation,” a Procedural High Jump:

Before moving forward with a tax reform bill, Congress must first pass a federal budget for FY2018 which includes instructions for tax legislation.  The process, known as “budget reconciliation,” allows the Senate to pass a bill with 51 votes, therefore bypassing the 60 vote threshold necessary to avoid the filibuster that applies to most legislation.   This parliamentary tactic is crucial for tax reform legislation, where Republicans must receive the support of the vast majority of their Senate members to pass a bill.  On October 4, AHC joined more than 40 agriculture groups – including the American Farm Bureau Federation and American Veterinary Medical Association – in a letter to Congress expressing support for passage of a budget resolution with reconciliation instructions for tax reform.  On October 5, the House of Representatives passed its $1.132 trillion budget, which it claims will achieve $6.5 trillion in deficit reduction over ten years. 

Attention now turns to the Senate, which is expected to consider a $1.5 trillion budget during the next four weeks.  To make sure lawmakers remain focused on the tax reform process, please call your senators today and tell them “to pass a budget today that paves the way for tax reform.”  You can contact your senators’ Washington offices by calling the Capitol switchboard at 202-225-3121.  

Status of the Debate:

AHC and its partners have met this week with congressional leadership offices and White House staff, who remain optimistic that substantial progress toward tax reform will take place during the weeks ahead.  Policy makers have also made it clear that to push tax reform across the finish line, the legislation must include major provisions that bolster the middle class.  To that end, officials have underscored the importance of mortgage interest and charitable giving deductibility, the prospect of lower rates through consolidated deductions, and the overall simplicity of a streamlined code.  The House Ways and Means Committee has created a template “postcard” to illustrate the taxpayer-friendly approach favored by proponents of reform.  To view a copy of the proposed, streamlined tax form, click on the following link:  https://waysandmeans.house.gov/tax-form-simple-fit-postcard/.  

Horsemen and horsewomen can deliver a timely message by contacting their elected officials and expressing the need to modernize the code in general, and specifically to repeal the outdated death tax.  Other issues that will emerge as the debate moves forward will include deductibility of business interest, expensing of depreciable assets, and establishing a top rate of 25% for sole proprietorships, Subchapter S-Corporations, and other small business entities.  If you would like more information related to tax reform, please contact Bryan Brendle at bbrendle@horsecouncil.org.    

Guest Worker Visa Reform Gains Momentum, Tell Congress to Finish the Job!

October 4, 2017

Status update

On September 15, the House of Representatives passed a $1.2 trillion funding bill for Fiscal Year (FY) 2018 that will serve as a benchmark for negotiations with the Senate on a final package.  Congress must negotiate a final bill by December 8, when the current continuing resolution (CR) to fund federal programs at FY2017 levels will expire.  While the equine industry and its allies have taken an important first step by inserting some H-2B visa reform measures within the text of the current House spending bill (such as wage-survey flexibility), the fight to insert broader visa cap relief in a final spending bill continues.  

Legislation Moving in Congress:

Fortunately, Congress can fix the broken guest worker visa program by acting on legislation currently moving through the legislative process.  AHC members can help push the legislative process forward by weighing in with your elected officials in Washington.  Contact your federal lawmakers today and urge them to support H2B visa reform through the following vehicles:

  • FY2018 Appropriations – Tell your lawmakers to include H-2B visa cap relief provisions in the final spending bill. This must-pass legislation is the most active vehicle moving through Congress.  Meaningful cap relief includes common-sense exemptions for returning guest workers.    
  • Strengthen Employment and Seasonal Opportunities (SEASON) Act (H.R. 2004) – Tell your representative to cosponsor H.R. 2004, which will provide cap relief by establishing an exemption for well-vetted workers who have already held a visa. This bill currently has 30 co-sponsors, a number which must grow to gain more political traction.  If your representative is already a sponsor, tell him to contact leadership to assure passage.   
  • Save Our Small and Seasonal Businesses Act of 2017 (S. 792) – Call both of your senators and tell them to cosponsor S. 792, legislation that will expedite applications to meet labor demands during peak seasons. This bipartisan bill currently has 12 sponsors, and will need many more to win floor time in the Senate.  If your senators are already sponsors, tell them to contact leadership to make the bill a high priority.  

To contact your lawmaker’s Washington office, please call the Capitol switchboard at 202-225-3121, and ask to be connected to your elected official’s office.  Also, you can tweet your representative and senators by using #SaveH2B. 

Emerging Legislation, Next Steps:

House Judiciary Committee Chairman Bob Goodlatte (R-VA) is soon expected to introduce the Agricultural Guest Worker Act of 2017, legislation that would replace the cumbersome H-2A program with more flexible H-2C visas.   The draft text shared with AHC from House Judiciary Committee staff would accomplish the following benefits for large segments of the equine sector: 

  • The bill would replace the H-2A program outright, with a new program that creates incentives to hire foreign labor through legal channels;
  • Reduce financial and paperwork burdens on agricultural employers by discarding H-2A mandates such as free housing and transportation;
  • Create marketplace flexibility by establishing “at will” employment between visa holders and agricultural employers;
  • Establish a baseline of 500,000 visas, with a built-in “escalator” that can result in 10% increases in the number of guest visas issued in subsequent years.  According to State Dept. stats, the number of H2A visas has fluctuated between 65,000 and 135,000 during the past five fiscal years. 

The House Judiciary Committee postponed a hearing scheduled for Wednesday, October 4 to formally introduce and review the bill.  AHC will keep you updated on developments related to the Agriculture Guest Worker Act, and other legislation impacting hiring practices for the equine sector.  If you would like a summary of the draft bill, or have perspectives on immigration policy and priorities you would like to share, please contact Bryan Brendle at bbrendle@horsecouncil.org

X