Manufacturers applaud Sen. Portman’s leadership in introducing legislation to roll-back recent aggressive IRS audit practices. The bill, S. 2809, would prevent the IRS from denying cooperative taxpayers access to the IRS Appeals Office in order to seek an independent review of the examination. Additionally, the bill would limit the use of designated summonses to cases where a taxpayer is not cooperating with the IRS. The bill also would prevent the IRS from unilaterally extending the statute of limitations on an audit. Finally, manufacturers are pleased that the legislation would prevent the IRS from hiring outside law firms to assist in an audit and investigation of a corporate taxpayer. This practice has already been questioned by at least one court. Beyond the concerns about potential conflicts of interest that this practice raises, the fact that the IRS would outsource this inherently governmental function and expose confidential tax information to an outside entity is a real concern to manufacturers. The NAM urges the Congress to take up this bill and put an end to these abuses for once and for all.
PBGC premiums—the fees companies maintaining defined benefit (DB) pension plans pay to the Pension Benefit Guaranty Corporation (PBGC)—have been unexpectedly and unnecessarily increased several times over the past few years by more than $20 billion, with manufacturers paying roughly half that amount.
As a result, manufacturers and other companies with single-employer DB plans are paying millions of additional dollars to the PBGC that could otherwise be used to fund participant benefits or even job-creating business investments. Premiums have increased so often and so drastically in recent years that even the Obama administration—once a proponent for additional premiums in past budget proposals—called on Congress to pump the brakes in its recent budget proposal before these rising costs cause more companies to exit the DB system.
Though not necessary, PBGC premiums continue to increase for one reason: under current law, Congress can “pay for” other legislation by increasing premiums. In reality, the premiums are not actually paying for any legislation since companies pay premiums directly to the PBGC and no money flows to the general treasury for revenue. In essence, this is a budget gimmick that has a real negative impact on manufacturers and other sponsors of DB pension plans.
In an effort to refocus Congress on good governance and ease plan sponsors’ uncertainty, Congressman Jim Renacci (R-OH) introduced the Pension and Budget Integrity Act of 2016 (H.R. 4955) to take PBGC premiums “off budget,” thereby ending the desire for Congress to raise these fees to pay for unrelated legislation.
The NAM applauds Mr. Renacci and the original cosponsors—Reps. John Carney (D-DE), Richard Hanna (R-NY), Derek Kilmer (D-WA), Mark Pocan (D-WI) and Daniel Webster (R-FL)—for introducing this important pro-manufacturing legislation and will work with our allies in Congress to advance H.R. 4955.
Earlier this year, the NAM was quick to push back against the European Union’s (EU) plan to make public tax and profit reports for global companies operating in EU countries. Not only has the EU ignored our concerns, but it has proposed going one step further and extending the public reports proposal to so-called “tax havens,” which are to be determined by the EU.
Manufacturers believe that a fair and transparent tax climate helps boost living standards and economic growth everywhere. In contrast, requests for much more information than needed to assess a company’s tax liability, coupled with the public disclosure of this tax and financial information, will threaten economic growth and competitiveness on a global basis. Read More
It is abundantly clear to manufacturers in the United States that our current tax code has to go—it’s complicated and arcane, holds back economic growth and makes us less competitive. While we’re working hard to get lawmakers to update and improve our nation’s tax system, Treasury Secretary Jack Lew, with a stroke of a pen, managed to make a bad system significantly worse. Read More
In recent months, the NAM criticized some of the recommendations coming out of the Base Erosion and Profit Shifting (BEPS) plan spearheaded by the Organisation for Economic Co-operation and Development, particularly new information disclosure rules that will force companies to disclose sensitive business information and impose additional and unnecessary compliance burdens on them. Read More
On Tuesday, the NAM partnered with member company PPG, a world leader in coatings, and K&L Gates law firm to discuss the outlook for tax reform and recent developments in the international tax arena surrounding the implementation of the Organisation for Economic Co-operation and Development’s Base Erosion and Profit Shifting (BEPS) project. Attending the forum at the K&L Gates Conference Center in Pittsburgh were members of the area business community and representatives from the Pennsylvania senatorial delegation. Read More
NAM Vice President of Tax and Domestic Economic Policy Dorothy Coleman was profiled by CQ Weekly as one of Capitol Hill’s top “influencers” for her advocacy on behalf of manufacturers for comprehensive tax reform. The profile highlights Coleman’s work as an advocate on behalf of manufacturers for a comprehensive tax overhaul that includes “lowering the 35 percent corporate rate and cuts taxes for small companies whose owners pay individual income tax rates on business income.”
According to the article, the conversation on tax reform is heating up as House Speaker Paul Ryan (R-WI) begins to map out a plan for a major tax overhaul in the next year. Coleman is listed among five tax policy experts who will “help guide the debate.”
Unfortunately, the House Committee on Oversight and Government Reform Committee is scheduled to consider the Senate-passed Truth in Settlements Act (S. 1109) on March 1. S. 1109 requires federal agencies to publicly post information on their websites about settlement agreements greater than $1 million and indicate whether the settlement payments are tax deductible. The NAM objected to this bill prior to its passage in the Senate and continues to be concerned about the negative impact this legislation may have on manufacturers. Read More
In a statement submitted to the House Ways and Means Committee for today’s hearing on the Global Tax Environment in 2016 and Implications for International Tax Reform, the NAM highlighted concerns about some of the recent tax policy developments in Europe that will have a negative impact on U.S. manufacturers. Read More
During a panel discussion today hosted by the American Action Forum, National Association of Manufacturers (NAM) Vice President of Tax and Domestic Economic Policy Dorothy Coleman warned that recent recommendations coming out of the Base Erosion and Profit Shifting (BEPS) project, spearheaded by the G-20 and the Organisation for Economic Co-operation and Development (OECD), could undermine the competitiveness of U.S. manufacturers and threaten the confidentiality of their most sensitive business information. The event, titled “Evaluating the BEPS Initiative: Who Wins, Who Loses and What Matters Most,” examined the potential impact of the OECD’s BEPS plan and featured keynote remarks from House Ways and Means member Charles Boustany (R-LA).