Atlanta, Georgia – Today, the Georgia Chamber, the state’s largest business advocacy organization which represents tens and thousands of members, sent a letter to Georgia’s Congressional Delegation urging them to take immediate action on four business-killing federal tax policies.
In 2017, the Tax Cut and Jobs Act brought about the most comprehensive tax overhaul the United States has seen in over three decades. While some of the provisions found within this legislation provided American businesses with much-needed relief, several areas require significant fixes to protect small businesses and start-ups in Georgia.
The first provision, found in Section 174, creates dramatic changes in the way companies can deduct their vital research and development initiatives. These deductions allow businesses, especially those in their early stages of operation, to invest in new products, processes, and technologies.
“I have heard from hundreds of our members that this change disincentivizes them from engaging in new product development, posing a significant threat to their ability to innovate,” said Chris Clark, President and CEO of the Georgia Chamber.
Other changes in the tax code inhibit companies from investing in capital equipment because of decreases in bonus depreciation percentages and limit the amount of business interest expense based on the amount of interest income. Both deductions have been invaluable to Georgia’s economic environment and these alterations must be remedied with fair, consistent tax policies.
Finally, Section 199A was changed to allow businesses to deduct up to twenty percent of their income. After 2026, this will no longer apply, leaving small businesses and other companies worse off than before the 2017 legislation was enacted.
“Over 95% of Georgia’s companies are small businesses. After the deduction expires, many of them will be left paying more taxes than multinational firms,” said Clark. “We are calling on Congress to stop playing political games, preserve vital tax relief, and take action on all of these issues.”
To learn more about the Georgia Chamber and its efforts to combat harmful legislation, and advocate for free markets, job creation, and pro-business policies, visit gachamber.com.