After years of talk, Congress is now close to actually passing meaningful, permanent tax reform. For the retail industry, this is very good news.
NRF has been fighting for tax reform for years, and we are optimistic about the current effort. Tax reform is a long-sought goal that would significantly help our industry and create a fairer tax code.
Though the House and Senate have different proposals, their key goals and priorities align. Both proposals would cut the corporate tax rate, provide tax cuts to individuals and small business “pass throughs” and generally simplify the tax code.
Here’s why both proposals are good for retail:
- They address retail’s high, unequal tax burden: Both proposals would cut business tax rates and close loopholes, lowering retail’s high and unequal tax burden. Retail currently pays the highest effective tax rate of any industry since retailers don’t benefit from most of the tax breaks and loopholes that other businesses use.
- They enable reinvestment: By lowering retail’s tax burden, both proposals would free up money to reinvest in businesses and employees. That means stronger retailers, better pay and more jobs.
- They provide tax relief to consumers: Both proposals would provide tax relief to consumers, increasing their discretionary income. More consumers with more money to spend would be a long-lasting boon for retailers.
The proposals aren’t perfect, but they offer a big improvement for the retail industry. Tax reform would create a fair tax code, trigger reinvestment and boost the spending power of consumers — all key ingredients for retailers to continue to grow.
Despite these benefits, tax reform is not certain yet. Join with us in asking Congress to vote yes on tax reform.