Associated Equipment Distributors President and CEO Toby Mack released the following statement in response to President Obama signing legislation Nov. 21 to repeal the three percent government contractor withholding tax (H.R. 674). The tax, created by Sec. 511 of the 2006 Tax Increase Prevention Reconciliation Act, would have required state and local government entities whose annual expenditures exceed $100 million to withhold three percent of all payments made to any individual or company that provides goods or services to the government.
“AED applauds the repeal of the burdensome three percent government contractor withholding tax. The elimination of this onerous law ensures that companies working with government entities are not punished by increased contract administration costs that did nothing to help the federal budget.
“The bipartisan push to repeal this law shows the positive consequences of putting politics and partisanship aside to focus on economic prosperity. AED looks forward to working with Congress and the president to maintain a focus on long-term growth and promoting economic certainty for our nation’s job creators.”