Farmers and ranchers wary of Republican tax cut plan

Republican tax reform plans risk falling foul of one of the most politically influential constituencies in the US as agriculture lobbyists warn that some in their sector could end up paying higher taxes because of the overhaul. In their drive to lower tax rates and simplify the system, the Trump administration and lawmakers are considering the elimination of a range of items businesses can deduct from their tax bills. Agriculture lobbyists are ramping up meetings on Capitol Hill to ensure their sector does not lose tax breaks that they say are critical to keeping the sector profitable. The reforms will result in a cut in the corporate tax rate from 35 per cent to 20 per cent, the simplification of the individual system, and the rate for unincorporated businesses called “pass-throughs” lowered to 25 per cent. Patricia Wolff, senior director for congressional relations at the American Farm Bureau Federation, said many farmers already pay an effective tax rate of below 20 per cent, meaning they are watching closely to ensure they do not end up paying higher taxes as a range of taxt deductions are scrapped. Among a number of issues for farmers are possible limits on their abilita to deduct interest against tax bills, and the fate of a tax break intended to support domestic production in the US...more