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BLOG: Contractors, Not Just Lobbyists, Must Push Tax Reform

Our form of government doesn’t work without citizens—private and corporate—making themselves heard.

Mon August 01, 2016 - National Edition
Giles Lambertson


Builders associations are not the only lobby wanting the tax system reformed, they just are more adamant about it than some.
Builders associations are not the only lobby wanting the tax system reformed, they just are more adamant about it than some.

Industry associations look after their own. This is called lobbying. It is how one industry competes with another, by accumulating clout and wielding it on behalf of members in policy-making negotiations. But member companies need to look after themselves, too.

Take the matter of taxes. Building contractors are hit pretty hard with current tax policy. As Associated Builders and Contractors notes on its website, “The construction industry historically has paid the highest effective tax rate of any economic sector in the country.” Furthermore, “while the U.S. corporate tax rate stands among the highest in the world, more than 90 percent of construction businesses are subject to the individual rate, which remains higher still.”

Echoes the Associated General Contractors on its website: “At 31 percent, construction companies pay the highest effective rates of any industry. Effective tax rates should be reduced.”

So tax reform is high on the priority list of construction industry associations. And not just tax reform, but “comprehensive” tax reform. That is, overhauling the whole taxing system—corporate and individual. A variety of reform ideas are proposed, including slimming the code, repealing the Alternative Minimum Tax, revising tax rules that discourage public-private partnerships, repealing the “death tax,” lowering rates, and dumping accounting practices like “look-back” that are tough on small contractors.

Builders associations are not the only lobby wanting the tax system reformed, they just are more adamant about it than some. It follows that individual contractors should be adamant, too.

So what can individual contractors do? Hint: This is a big election year. Guess who pushes and enacts tax policies? Elected federal, state and local officials, that's who. Relying on lobbyists to influence policy-makers is not enough. Contractors should get personally involved this campaign season in backing and opposing candidates who oppose tax reform and the reduction of egregiously high tax rates.

Our republican form of government doesn't work without citizens—private and corporate—making themselves heard. What's that? I can't hear you.




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