TAX RELIEF
NSSGA POSITION:
NSSGA supports minimizing the tax burden on businesses and working families in order to increase
the rate of capital formation, economic growth and job creation. NSSGA supports pro-growth tax-relief legislation that will reduce and simplify taxes, eliminate the “death tax,” and reduce taxes
on capital gains.
BACKGROUND:
Fiscal responsibility, economic stimulation and a balanced budget are key to a healthy economy. With over 10,000 operations nationwide located in every state and in 70 percent of the nation’s counties, the crushed stone, sand and gravel industries are major contributors to the strength of the nation’s economy.
President George W. Bush submitted a $1.6 trillion tax relief proposal to Congress in mid-February 2001. NSSGA joined the Steering Committee of the Tax Relief Coalition, a coalition of over 1,000 businesses and associations, to press for passage of the President’s plan. Congress passed the legislation on May 26, 2001, and the President signed it into law on June 7, 2001.
Key provisions of the final agreement included reduction of individual rates beginning July l, 2001, when the current rates of 15 percent, 28 percent, 31 percent, 36 and 39.6 percent dropped to 15, 27, 30, 35, and 38.6 percent respectively. The bill also created a new 10 percent tax rate retroactive to Jan. 1, 2001, for the first $6,000 of taxable income for single taxpayers, $10,000 for single heads of households and $12,000 for married couples filing jointly.
The bill doubled the $500 per child tax credit over 10 years, phased out the estate tax over 10 years and phased in marriage tax relief.
Finally, the bill gave taxpayers the benefit of the new 10 percent rate as quickly as possible. The Treasury sent out rebates by October 1, 2001, of $300 for individual filers, $500 for heads of households and $600 for couples filing jointly.
Many of the tax relief provisions expire in 2010. Of specific interest to the
aggregates industry is the death tax
repeal which will be reinstated on
Jan. 1, 2011, unless Congress acts
to extend the tax relief.
TALKING POINTS:
- Lowering taxes encourages spending, which helps the crushed stone, sand and gravel industries contribute to new construction for critical highway and airport projects necessary to ensure safe and cost effective transportation infrastructure.
- Reduction of tax rates provides significant tax relief to millions of aggregates businesses that are structured as sole-proprietors, partnerships, or S-corporations.
- Elimination of the federal estate tax is key to the continued growth of the crushed stone, sand and gravel industries, as a significant number are family owned. “Death taxes” have been so high that many families have had to sell their businesses in order pay the taxes. Employees, customers and local communities all suffer.
- The tax relief package did not include relief from capital gains taxes, an additional positive step that needs to be taken. Taxes on capital gains (assets held for more than one year) have significantly increased since the mid 1980s. Reduction in taxes on capital gains would have a positive impact on the economy through increased domestic investment, real income and revenue for the Treasury.
Updated: November 2008
