AFS Advocating for Reform of Tax System
July 19, 2017
The American Foundry Society (AFS) on July 17 submitted comments to Senate Finance Committee Chair Orrin Hatch (R-Utah) and Committee members concerning federal tax reform. In the letter, AFS asserts, “There is widespread consensus that the United States needs to reform its tax system.” AFS advocates for comprehensive tax reform that encourages manufacturing activity in the U.S., lowers tax rates both for corporations and pass-through businesses, and restores simplicity and predictability to the tax code. The majority of U.S. metalcasters are small- or medium-sized businesses, often family-owned, and organized as pass-through entities such as Subchapter S Corporations, so taxes are paid by their owners at individual rates.
In its comments, AFS listed its tax priorities for the metalcasting industry:
- Lower tax rates.
- Full expensing for capital equipment.
- Accelerated depreciation.
- Permanent estate tax repeal.
- Preserve LIFO (last in, first out) accounting method.
- Retain a permanent, strong research and development (R&D) incentive.
“As a capital-intensive industry, metalcasters struggle to compete against our international competitors under an outdated tax system with high tax rates that diminish a company’s cash flow, thereby reducing the amount of money available to expand, purchase new equipment, hire more workers, bid on future projects, and reduce debt,” AFS said in its comments. AFS members discussed tax reform during their congressional meetings as part of the association’s Government Affairs Fly-In in June.
The Senate Finance Committee, charged with overseeing taxes, had its first tax reform hearing of the year on Tuesday, July 18, featuring former Treasury officials. Chairman Hatch and other congressional leaders are meeting with Trump administration officials to negotiate a broad outline for overhauling the tax code. They hope to have a bill by early fall.
AFS is the leading national advocate for public policies that support a strong metalcasting economy. Other key AFS priorities include reform of OSHA’s ill-advised silica regulation, regulatory reform, infrastructure investment, and strong enforcement of trade laws. Public policies have a large financial impact on foundries, suppliers, and casting purchasers, making policy advocacy one of the key roles of AFS.
The American Foundry Society is a not-for-profit organization formed in 1896. With its headquarters in Schaumburg, Illinois, AFS provides members and consumers with information and services to promote and strengthen the $30.3 billion metalcasting industry.