Manufacturers ‘Key Vote’ Against Tax Increases

By August 10, 2010Economy, General, Taxation

The National Association of Manufacturers sent a “Key Vote” letter Monday to the U.S. House opposing the Senate Amendment to H.R. 1586, now known as the Education Jobs and Medicaid Assistance Act.

This is the bill the Senate passed last week and for which Speaker of the House Nancy Pelosi called the House back to Washington. You can read the text of the legislation starting at page Senate Amendment 4575, the text of which starts S6587 of The Congressional Record.

From the NAM’s letter:

While the NAM has taken no position on the spending provisions in the legislation, we remain adamantly opposed to using proposed tax increases on American worldwide companies to fund unrelated spending initiatives.

An estimated 22 million people in the United States – more than 19 percent of the private sector workforce and 53 percent of all manufacturing employees – are employed by companies with operations overseas. Manufacturers feel strongly that imposing $9.6 billion in tax increases on these companies as proposed in the Senate Amendment to H.R. 1586 will jeopardize the jobs of American manufacturing employees and stifle our fragile economy.

Some of the proposed tax increases, which are mischaracterized as closing tax loopholes, actually represent significant changes to pro-growth tax policy supported by Congress and the Administration.
We are disappointed that many of the legislation’s proposed tax increases have not been adequately scrutinized during congressional hearings. In many cases, taxpayers have relied on these longstanding tax provisions in structuring their businesses. Changing the rules without fair and adequate hearings will cost in terms of jobs, investment and manufacturers’ ability to compete overseas.

Manufacturers believe strongly that changes to our international tax laws should be considered in the broader context of tax reform that makes the United States more competitive – not as “pay fors” for unrelated policy initiatives. Moreover, targeting some international tax law changes in advance of the tax reform debate would make the goal of pro-growth, pro-competitiveness reform that much more difficult, if not impossible, to achieve.

Key Vote letters are used to notify members of Congress that their votes will be taken into account when rating a member’s voting on manufacturing-related issues. The positions are determined by the Key Vote Advisory Committee composed of representatives of NAM-member companies of all sizes.

The NAM is member of the PACE Coalition of major business trade associations, which last week registered its opposition to the tax increases in the Senate bill.

The House convenes at 9 a.m. today. Bloomberg reports on the politics of the issue in this story.

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