The National Lumber and Building Material Dealers Association (NLBMDA) is urging its members to jump into action by contacting their U.S. Senator regarding the Tax Cuts and Jobs Act.
The Senate is expected to vote on the bill as early as today. According to the NLBMDA, the legislation eliminates the state and local tax (SALT) deduction, which would negatively affect residential housing, the lumber and building material (LBM) industry, and the economy overall.
In statement issued today, the NLBMDA said it is “in strong opposition to eliminating the SALT deduction. These changes would harm individuals living in areas with higher local and state taxes, and make it more difficult for businesses in those areas to retain and attract workers.”
Other components of the legislation include the amount of mortgage debt eligible for the interest deduction remaining at $1 million and includes the deduction for second homes. However, the interest deduction on home equity loan debt up to $100,000 is eliminated, the NLBMDA says.
The NLBMDA said it strongly supports several provisions in the legislation, including lowering the corporate income tax rate to 20 percent, and the immediate write-off of capital purchases (excluding land) through 2022. Making permanent the full expensing of business investments will provide businesses with greater certainty and predictability.
Unlike the House-passed tax reform bill, the Senate legislation does not repeal the estate tax. Although the Senate bill does double the exemption levels ($11.2 million for individuals, $22.4 million for couples) and indexes for inflation, the NLBMDA said.
“Tax reform is needed to increase economic growth and opportunity,” the NLBMDA said. “Unfortunately, the elimination of the SALT deduction in the Tax Cuts and Jobs Act places too much burden on homeowners living in higher cost areas and would harm residential housing and construction.”