“As we prepare for all possible outcomes of the upcoming election, the Chamber is seeking to unite a broad-based coalition across the business community to advance comprehensive, consensus-based solutions for a pro- growth and globally competitive U.S.
business tax system that preserves our tax base.”
— Sara Hoyt Corrigan Tax Counsel, Tax Policy U.S. Chamber of Commerce
says. “This scenario played out in practice during the years leading up to 2017, when the United States had the highest statutory corporate tax rate in the industrialized world, causing many formerly U.S.-headquartered multinationals to redomicile abroad.” Consumers and equipment buyers
are also harmed by tax increases through the higher prices that often follow. A U.S. Chamber poll published in June 2024 found that 80 percent of voters believe higher taxes will lead to higher prices, and 67 percent said that taxes paid by both families and businesses were already too high.
Looking Toward 2025 Given those factors, there appears to
be a great deal of eagerness to extend the tax cuts and avoid what would be one of the largest tax increases in American history. The 119th Congress is expected to take on the issue once it is seated next year. “In 2025, the expiration of other provisions like the TCJA’s lower individual tax rates will be an action-forcing event — with real political ramifications — that should spur the next Congress to find an outcome,” Hoyt Corrigan says. “With this in mind, it is essential for the business community to make its case early and often with lawmakers so they realize the extent of what is at stake. To that end, the U.S. Chamber is working to educate members of Congress and congressional staff about the looming 2025 fiscal cliff. “As we prepare for all possible outcomes of the upcoming election, the Chamber
12 FEDA News & Views
is seeking to unite a broad-based coalition across the business community to advance comprehensive, consensus- based solutions for a pro-growth and globally competitive U.S. business tax system that preserves our tax base,” Hoyt Corrigan says. It’s too early to know what a potential
2025 tax relief bill might look like — especially with a possible shift in power on the horizon in the presidency and both chambers of Congress — but the Chamber is pushing for three critical components to be included. Those are: • Preserving the country’s newly competitive business tax rates (i.e., the 21 percent corporate income tax rate and the 20 percent deduction for pass- through business income)
• Ensuring a competitive business tax base (i.e., one that allows a deduction for R&D expenses, full capital expensing for certain business assets and a pro-growth interest deductibility limitation)
• Maintaining the competitiveness of the U.S. international tax system, for both U.S. companies operating abroad and foreign companies investing in the United States, while preserving the corporate tax base.
Obstacles to an Extension There are already signs that the next
wave of tax cuts will look different than in 2017 after two attempts to extend parts of the TCJA failed. The Main Street Tax Certainty Act would have made the tax deduction for qualified business income permanent, but it has been stuck in the House Committee on
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