Don’t Make Tax Burden Heavier
Last-day haggling over the tax reform bill approved in the wee hours of Saturday by the U.S. Senate resulted in a serious error. A measure intended in part to help companies create new jobs could cost thousands of them.
As we reported Monday, Murray Energy Corp. Chairman, President and CEO Bob Murray worries the Senate bill, if enacted, could cost his company as much as $60 million in higher taxes each year.
If the Senate plan would be that costly to Murray’s coal mining interests, it undoubtedly would harm many other businesses, too.
When the House of Representatives approved a tax proposal last month, one provision was aimed at eliminating the Alternative Minimum Tax requirement. The AMT has been unpopular for years, among both individual and business taxpayers.
But the Senate bill allows the AMT to remain in place. That decision reportedly was made Friday, in negotiations aimed at ensuring Republicans would have a majority when time came to vote on the bill. It passed, 51-49.
Murray, whose company employs thousands of men and women in our area and other states, worries the Senate’s action will harm other mining companies, in addition to his.
As the coal industry begins attempting to recover from former President Barack Obama’s war on coal and affordable electricity, higher taxes are the very last thing it needs. They could be the proverbial straw breaking the camel’s back for some firms.
Senate approval of its tax reform plan sets the stage for reconciliation negotiations. Leaders from both chambers will have to agree on a single, identical bill.
President Donald Trump has signaled that, for his part, he may consider some structural changes in tax reform legislation. Specifically, the president may be open to allowing a 22 percent corporate tax rate, up from the 20 percent in both House and Senate bills.
Clearly, both bills — though aimed in the right direction — contain some flaws. The process of ironing them out should include addressing the AMT provision and any others that may be counterproductive. By that, of course, we mean errors that could make it more difficult, not less, for companies of all types to create new jobs.