On September 9, the House Committee on Ways and Means, which has jurisdiction over tax policy, began consideration of its share of President Biden’s American Families Plan. The final price tag of the overall legislation is still being negotiated by the House and Senate, as moderate Democrats, such as Senator Joe Manchin of West Virginia, are seeking to scale back the size and scope of the legislation. This will have significant bearing on how large the overall package of tax increases will be that the Ways and Means Committee will consider.
Currently, the Committee is scheduled to release their draft proposal of tax increases early next week, although that may be pushed back. Amongst the broad tax increases potentially under consideration that AGC has expressed concern about are:
- an increase in tax rates for individuals and corporations;
- an increase in the tax rate on capital gains income, including a new “double death tax” where accumulated capital gains would be taxed at the time of death; and
- phasing out the Section 199A qualified business income deduction for pass-through businesses.
Last week, AGC sent a letter to Ways and Means outlining concerns regarding these potential tax increases and their effect on the construction industry.