By Ben Gann, Director of legislative affairs, NLBMDA
A combination of expiring tax cuts, automatic spending cuts and a need to raise the debt ceiling at the beginning of 2013 has led the United States on the verge of a “fiscal cliff.” Congress is unlikely to address the issue until after the November elections, creating more uncertainty in an already sluggish economy.
In 2001 and 2003, Congress passed tax cuts lowering rates on individuals, capital gains, dividend and estates that are set to expire at the end of the year. Commonly referred to as the “Bush tax cuts,” they were scheduled to end at the end of 2010, but a last-minute agreement provided a two-year extension. Further complicating matters are automatic spending cuts at the start of the year unless Congress stops it from taking effect, and also the need to raise the $16.394 trillion federal debt ceiling.
Gridlock on the fiscal cliff will continue until after the November election when at least a short-term resolution is possible before the end of the year. The NLBMDA is engaged in this debate and is working with Congress and the White House to make sure the interests of lumber and building material dealers are well represented.