SPONSORED:

Leader of manufacturers group wants Trump tax law provision to be made permanent

Leader of manufacturers group wants Trump tax law provision to be made permanent
© Getty Images

National Association of Manufacturers (NAM) President and CEO Jay Timmons on Wednesday urged policymakers to make permanent a deduction created by President TrumpDonald John TrumpBiden to nominate Linda Thomas-Greenfield for UN ambassador: reports Scranton dedicates 'Joe Biden Way' to honor president-elect Kasich: Republicans 'either in complete lockstep' or 'afraid' of Trump MORE's 2017 tax law that benefits owners of certain businesses.

"On taxes, we want to keep moving forward on tax reform," Timmons said in Iowa in the NAM's "State of Manufacturing" address. "The 20-percent deduction for small businesses, and I know there's a lot of small-business owners that are watching today, please know we're working to make that permanent. We want to expand it."

The Republican tax law created a 20-percent deduction for income from noncorporate businesses known as "pass-throughs," which pay taxes through the individual code on their owners' tax returns. Many small businesses are pass-throughs, as are many real-estate companies and some banks. Like other tax changes for individuals in the 2017 law, the pass-through deduction is currently scheduled to expire at the end of 2025.

ADVERTISEMENT

The deduction has the support of business groups and many GOP lawmakers, who argue that it's helpful for small businesses. But the deduction has also faced criticism, particularly from Democrats. Critics argue that the deduction largely benefits high-income people and is arbitrary because owners of some types of businesses are eligible for the deduction while owners of other types of businesses often aren't.

Timmons also said that Treasury should implement the tax law "as Congress intended."

Timmons added that the tax law was "rocket fuel" for the economy in 2018, but that things slowed the following year amid trade uncertainties.

He said Trump should be credited for reaching a "phase one" trade deal with China, and the U.S. should now negotiate phase two "to turn the trade war into a full-scale, enforceable trade agreement." He also said that the U.S. should secure trade deals with as many countries as possible before China does and "fully implement" Trump's trade deal with Mexico and Canada.

Timmons's speech came less than two weeks before the first-in-the-nation Iowa caucuses. Timmons said that the NAM doesn't endorse presidential candidates, but said that the best policymakers support free enterprise, a level playing field for U.S. manufacturers to compete globally, individual liberty and equal opportunity.