Winton Machine CEO: Changes “Are Like a Tax on Manufacturing Growth”
Recent changes to the U.S. tax code are threatening manufacturers’ continued success—and they need to be reversed now, Winton Machine Company CEO and NAM board member Lisa Winton told U.S. lawmakers at a recent hearing.
What’s going on: Winton, whose 25-year-old company designs and manufactures machines used in tubular part and coaxial cable fabrication, testified before the House Ways and Means Committee at a hearing last Friday on the state of the American economy.
- Winton spoke about the challenges facing manufacturers and highlighted the impact of two recent changes to the tax code that increase the cost of financing machinery purchases: the phaseout of immediate expensing and limitations on deductions for interest on business loans.
- “While I would like to double the size of my facility, the cost of doing so has risen fourfold over the last several years,” said Winton, whose business is one of approximately 244,000 small manufacturers in the U.S.
Why it’s important: “These changes are like a tax on manufacturing growth,” Winton said.
- Winton expressed concern that “these changes will force our customers to keep using older pieces of equipment, rather than purchasing newer or additional ones, or they will buy cheaper equipment from Asia.”
- In addition to these two harmful changes, Winton spoke about another recent revision requiring businesses to deduct or amortize their R&D expenses over a period of years. This makes R&D more expensive because businesses “can [now] only recover a small portion of those costs each year.”
- In sharp contrast to this treatment, China currently allows a “super deduction” for manufacturers, Winton noted.
More to come: There are more harmful changes on the way. The 20% pass-through deduction is set to expire in 2025, “at the same time that tax rates for pass-through entities like ours go up across the board,” Winton said.
- In addition, a scheduled change to the estate tax could force family-owned businesses to sell off pieces of their companies.
The last word: “None of these tax changes are fair to our employees, their families [or] our communities,” she said. “We need to fix them so we’re not making it harder to do business in America.”
Manufacturers Unveil Competitiveness Agenda Ahead of Midterm Elections
“Competing to Win” offers a path for bringing the country together around policies, shared values and a unified purpose
Washington, D.C. – Ahead of the midterm elections, the National Association of Manufacturers released its policy roadmap, “Competing to Win,” a comprehensive blueprint featuring immediate solutions for bolstering manufacturers’ competitiveness. It is also a roadmap for policymakers on the laws and regulations needed to strengthen the manufacturing industry in the months and years ahead.
With the country facing rising prices, snarled supply chains and geopolitical turmoil, manufacturers are outlining an actionable competitiveness agenda that Americans across the political spectrum can support. “Competing to Win” includes the policies manufacturers in America will need in place to continue driving the country forward.
“‘Competing to Win’ offers a path for bringing our country together around policies, shared values and a unified purpose,” said NAM President and CEO Jay Timmons. “The NAM is putting forward a plan filled with ideas that policymakers could pursue immediately, including solutions to urgent problems, such as energy security, immigration reform, supply chain disruptions, the ongoing workforce shortage and more. Manufacturers have shown incredible resilience through difficult times, employing more workers now than before the pandemic, but continued resilience is not guaranteed without the policies that are critical to the state of manufacturing in America.”
The NAM and its members will leverage “Competing to Win” to shape policy debates ahead of the midterm elections, in the remainder of the 117th Congress and at the start of the 118th Congress—including in direct engagement with lawmakers, for grassroots activity, across traditional and digital media and through events in key states and districts as we did following the initial rollout of the roadmap in 2016.
The document focuses on 12 areas of action, and all policies are rooted in the values that have made America exceptional and keep manufacturing strong: free enterprise, competitiveness, individual liberty and equal opportunity.
Learn more about how manufacturers are leading and about the industry’s competitiveness agenda at nam.org/competing-to-win.
The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs more than 12.8 million men and women, contributes $2.77 trillion to the U.S. economy annually and accounts for 58% of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit www.nam.org