Federal Tax Reform Update

| Tax Policy & Competitiveness

Capitol Hill was busy last week. As you know, the U.S. House of Representatives passed H.R. 1, the Tax Cuts and Jobs Act, in a 227-205 vote last Thursday. This, while the Senate Finance Committee voted its own tax reform legislation out of committee. You can view a side-by-side comparison of both versions here. Now, all eyes will be on the Senate, as they prepare to consider their legislation as a full body after Thanksgiving.

In order to remain competitive in the modern global economy, our nation needs a tax code that propels job creation and maximizes the growth potential for job creators and the employees they support. Given that it has been more than 30 years since our nation’s tax code was last updated, there’s no doubt reform is long overdue. North Carolina knows well the competitive benefits that come from balanced, responsible tax reform. In just five short years, North Carolina’s tax climate catapulted from one of the worst in the nation to one of the most competitive. That didn’t happen by accident and it certainly wasn’t a coincidence. It’s now time to see that action at the federal level and we are encouraged by Washington’s committed reform efforts.

While there has been a great deal of movement on reform in recent weeks, this process is nowhere near complete. We will be following Congress’ progress closely as this legislative process is far from locked-in. As we review both versions of the bill and any future changes that might be made, we will look to see that the reforms advance the five principles critical to tax modernization: competitiveness, equity, efficiency, simplicity and certainty. If you’re interested in seeing how the Tax Cuts and Jobs Act will impact your legislative district or North Carolina as a whole, the U.S. Chamber has created one-pagers detailing just that. As always, if you have any comments or concerns about federal tax reform you’d like to share with us, please contact Jason Soper, director of governmental affairs.

Gary J. Salamido
Vice President, Government Affairs
North Carolina Chamber