Friday, January 12, 2018

Tax Trouble (Shame on the Republicans)

From his small grain company on the western Kansas plains, Gary Gantz admits keeping his 130-year-old family business going hasn’t been easy. Here, along the 100th meridian in Ness County where rain comes sparingly, Gantz runs D. E. Bondurant Grain, Ness City, one of the nation’s oldest continually operated private grain elevators. Sitting 60 miles from the nearest big city with a Walmart, Gantz has worked tirelessly to keep the family independent afloat in an era of big business and consolidation amid the ever-changing farm economy. We’ve been able to work through droughts and good times and bad times, and we can compete with the Cargills and ADMs of the world,” he said. Yet, Gantz has deep concerns about how a new U.S. tax law could affect the business his great-grandfather started in the 1880s. “Just about the time you have the boat turned and you have charted a course for the company and should be viable for a couple of decades, then the government comes out once again with a plan or program that has the potential to really hurt us.”
At issue is the new 199A deduction in the tax law that—if it stands—allows farmers and ranchers to claim a 20 percent deduction on all payments received on sales to cooperatives. For example, if a farmer sells $100,000 in grain to a cooperative, he or she could claim a $20,000 deduction on business income. Gantz said his accountant told him Jan. 11 the new provision could give cooperatives a significant advantage. Farmers would have more of an incentive to sell to co-ops instead of publicly traded or private grain businesses like his own company. “It’s pretty huge,” he said. “I think (the cooperatives) hit a homerun on this deal.” The provision, championed by Republican Sens. John Hoeven, R-ND, and John Thune, R-SD, was included right before the December passage of the bill... more

Here we have a Republican Congress and a Republican President favoring a government sanctioned collective over a private individual or firm. The R's are constantly telling us the government shouldn't pick winners and losers, but that is exactly what they've done in this instance. Worse yet, they've picked a government chartered collective as the winner and the private, individual entrepreneur as the loser.

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