In late December 2017, President Trump signed into law the tax reform bill that lowers rates, spurs economic growth, and will impact construction businesses for years to come. However, this process did not start as well as it ended for the industry.
While other industry trade groups chose to endorse early versions of the bill that would have done little to nothing to help the industry, AGC organized a rigorous lobbying effort that helped lower rates for passthroughs, such as S-corps, limited liability corporations and partnerships; prevented the elimination of Private Activity Bonds, essential to the financing of transportation infrastructure, low-income housing and other public construction and public- private partnership projects; and prevented the repeal of the Historic Tax Credit, critical to the private construction market for the rehabilitation and renovation of historic buildings.
AGC continued to fight for a better outcome for the industry by undertaking rigorous direct lobbying and social media campaigns funded by the Construction Advocacy Fund. The association’s efforts included connecting construction company CFOs and CPAs with tax writers, and generating thousands of pro-construction messages from members to key legislators.
AGC’s efforts helped convince members of Congress to reduce the corporate rate by 14 points, lower individual and pass through rates, double the estate and gift tax exclusion to $11 million, ensure the tax-exempt status of Private Activity Bonds remained untouched, and prevent full repeal of the Historic Tax Credit. Going forward, many of the tax provisions in the Tax Cuts and Jobs Act important to the industry, such as the new deduction for pass-through businesses, will need to be clarified through regulation. Additionally, because of budgetary constraints, many provisions in the law will expire in 2025 unless they are extended or made permanent.
AGC will continue to work with Congress to ensure the temporary tax provisions benefiting the industry are made permanent.