Legislative Updates

April 12, 2021

U.S. Chamber Says Congress May Need to Act on Retraining

Source: Bureau of Labor Statistics

Summarized from the U.S. Chamber of Commerce

In another sign of the improving economy, job openings are rising and the gap between them and the number of unemployed workers is falling. The Bureau of Labor Statistics (BLS) reports job openings each month in its Job Openings and Labor Turnover (JOLTS) series. BLS released the latest data for February last week, showing that job openings were 7.4 million – 268,000 more than in January.

Openings are above their level in February 2020, prior to the pandemic, when they were 7 million. They fell to 4.6 million in April and have been rising since.

While job openings have been rising, the number of unemployed workers has steadily decreased. Unemployment peaked in April 2020 at over 23 million workers but has fallen to just under 10 million in February.

In April 2020, when unemployment was at its peak and openings were at their nadir, there were 18.5 million more unemployed workers than there were openings. As of February, that gap had shrunk to 2.6 million – a remarkable improvement in less than a year.

The gap is probably smaller now. The March jobs report showed unemployment fell further and there are other indications that the labor market is improving.

It might not be too much longer before the number of job openings exceeds the number of unemployed workers. As of February, there were 1.35 workers unemployed for every opening. Even if that ratio falls below 1, that won’t mean all workers will be able to find jobs. There remains a skills mismatch in the economy that existed before the pandemic. The skills available workers have do not necessarily match the jobs employers have open. With so many service sector workers losing their jobs, but many openings (even prior to the pandemic) concentrated in business services and healthcare and social assistance, the mismatch poses an obstacle to recovery.

Congress will need to devote resources to retraining if it is to help alleviate this matching problem.
 

April 12, 2021

U.S. Chamber CEO Suzanne Clark Tells CNBC Corporate Tax Hike Would Hurt Businesses Ahead of Recovery

While a bold package to modernize the nation’s infrastructure is needed, it should not be paid for by raising taxes on corporations “at just the time businesses are getting back on their feet and we’re getting ready to have an economic recovery,” U.S. Chamber of Commerce President and CEO Suzanne Clark said April 8 on CNBC’s Closing Bell.

Clark’s comments came on the same day that the National Association of Manufacturers released a study that found the Biden Administration’s proposal to raise the corporate tax rate from 21 percent to 28 percent to fund a $2 trillion infrastructure plan would lead to the loss of 1 million jobs by 2023. Rather than raising taxes on corporations, Clark said it would be fairer to talk about user fees and gas taxes that would more directly impact the beneficiaries of infrastructure improvements.

Additionally, Clark said the administration should rethink its suggestion that other countries should increase taxes on companies to a minimum level. “We’re not ready to be American jobs and American competitiveness on the idea that other countries might help us out and raise their taxes,” she said.

Although the debate on Capitol Hill over how to pay for the infrastructure bill continues, Clark expressed hope that a solution would be found. “We’re optimistic there is a bipartisan compromise here that can get this critical work done on infrastructure, help American families, help American companies, and help us be more competitive.”

To view the full interview, please click here.
 

April 12, 2021

Toolkit Provides Samples Posts and Graphics for Social Media

Sample social media graphic from the U.S. Chamber of Commerce

As part of its efforts to oppose the proposed PRO Act, which would substantially rewrite the country’s labor laws, the U.S. Chamber of Commerce has published a Stop the PRO Act Toolkit. FEDA encourages members to use these sample posts for social media, letter templates, and graphics to urge their legislators to vote “no” on the bill.

Additionally, the Chamber held a Day of Action on Apr. 6 asking trade associations, state and local chambers, and concerned Americans to make their opposition to the proposed law known on social media using the hashtag #StopthePROAct.

For more information on the PRO Act and how it will alter existing labor laws, click here.
 

April 5, 2021

Bill Would Allow Younger Commercial Truck Drivers to Cross State Lines

FEDA has signed on to a letter asking legislators to support the DRIVE Safe Act (S. 659 and H.R. 1475), which would allow individuals under the age of 21 to obtain a commercial driver’s license and participate in interstate commerce.

This bipartisan legislation garnered the support of more than one-third of the House and Senate during the previous Congress and would help alleviate the country’s growing truck driver shortage. Forty-nine states and Washington D.C. already allow individuals under the age of 21 to obtain a commercial driver’s license for intrastate commerce. The DRIVE Safe Act would allow them to drive across state lines following a rigorous two-step apprenticeship program. To qualify, candidates must complete at least 400 hours of additional training – more than what is required for any other CDL holder in the nation.

To read the complete letter, please click here.
 

April 5, 2021

Chamber Will Continue to Urge Policymakers to Stand Against Tax on Trades

Following the huge swings in the value of GameStop stock earlier this year, the White House came out in support of studying the merits of a financial transaction tax. If implemented, it would be a sweeping tax on financial trades of all kinds. Previously, Sen. Bernie Sanders (I-VT) has proposed a 0.5 percent tax on stocks, a 0.1 percent tax on bonds, and a 0.005 percent tax on derivatives.

A recent bulletin from the U.S. Chamber of Commerce warned that “bringing back an FTT would be a huge mistake for main street, consumers, taxpayers, retirees, states, and localities.” The chamber pointed out that a previous FTT was repealed by bipartisan support in 1965 and that, if imposed, an FTT would come at the expense of money that would otherwise go into saving for retirement, a first home, or a child’s education.

Further, a recent poll conducted by the Chamber’s Center for Capital Markets Competitiveness found that 63 percent of Americans are deeply concerned and opposed to proposals to re-impose an FTT. A majority of votes also believe such a tax would undermine pressing policy priorities, particularly the nation’s recovery from COVID-19. As such, the Chamber said it would continue to advocate against the implementation of an FTT and would encourage policymakers to stand in bipartisan opposition to the proposed tax.
 

April 5, 2021

U.S. Chamber and NAW Urge Administration to Pursue Bipartisan Bill

President Joe Biden last week announced The American Jobs Plan, a $2 trillion proposal that would fund major infrastructure improvements across the country but also place higher tax rates on corporations.

A comprehensive explanation of the proposal may be found here. Highlights include:

  • $651 billion in transportation infrastructure to modernize 20,000 miles of highways, roads, and main streets and to upgrade thousands of bridges.
  • $85 billion to upgrade the nation’s public transit systems
  • $80 toward Amtrack’s maintenance and repair backlog
  • $42 billion for upgrades and modernization to airports, ports, and waterways
  • $100 billion build high-speed broadband infrastructure to reach 100 percent coverage
  • $100 billion to build a more resilient electric transmission system
  • $180 billion to advance U.S. leadership in critical technologies and upgrade the country’s research infrastructure
  • $50 billion to strengthen manufacturing supply chains for critical goods
  • $50 billion for semiconductor manufacturing and research
  • $52 billion for capital access programs geared toward domestic manufacturers, with a focus on supporting rural manufacturing and clean energy
  • $31 billion for programs that give small businesses access to credit, venture capital, and R&D dollars, including funding for community-based small business incubators and innovation hubs

To fully fund the plan, Biden called for several corporate tax changes that are designed to raise more than $2 trillion over the next 15 years. Those measures include:

  • Raising the corporate tax rate from 21 percent to 28 percent
  • Discourage offshoring by increasing the minimum tax on multinational U.S. corporations to 21 percent on a country-by-country basis
  • Enact a 15 percent minimum tax on large corporations’ book income
  • Increased enforcement of the tax code against corporations

In response to the unveiling of the Biden administration’s infrastructure plan, U.S. Chamber of Commerce Executive Vice President and Chief Policy Officer Neil Bradley released the following statement:

“We need a big and bold program to modernize our nation’s crumbling infrastructure and we applaud the Biden administration for making infrastructure a top priority. However, we believe the proposal is dangerously misguided when it comes to how to pay for infrastructure. Properly done, a major investment in infrastructure today is an investment in the future, and like a new home, should be paid for over time – say 30 years – by the users who benefit from the investment. We strongly oppose the general tax increases proposed by the administration which will slow the economic recovery and make the U.S. less competitive globally – the exact opposite of the goals of the infrastructure plan.

“The hard work of achieving bipartisan consensus is the best and only realistic path to enactment of historic infrastructure legislation,” Bradley continued. “While today’s action, coupled with continued efforts to find consensus from bipartisan groups in both the House and Senate is encouraging and a start in a long process, we urge both Democrats and Republicans to avoid further partisan gridlock and provide productive solutions to get an infrastructure bill passed this year.”

The National Association of Wholesaler-Distributors echoed concerns of how the corporate tax changes included in the proposal would harm businesses.

“Investing in America’s future is critical for the wholesale distribution industry, but it can’t be done on the backs of American small businesses,” NAW President and CEO Eric Hoplin said in a statement. “Modernizing our infrastructure and making it work for 21st century commerce would help the supply chain more efficiently move goods and materials to end users across the country. The Biden administration cannot improve the country’s infrastructure by increasing taxes on small businesses and wholesaler-distributors that have spent the past year fighting to operate safely, move products to customers, and keep their businesses alive during an unprecedented pandemic. With transportation and infrastructure being historically bipartisan issues, we urge Democrats and Republicans in Congress to work with the White House, put aside partisan agendas, and enact a long-overdue infrastructure bill to ensure that the economy continues to recover and businesses can continue to create needed jobs.”
 

March 29, 2021

Language Added to American Recovery Act Rankles State Leaders, NAW Says

Summarized from Jade West, National Association of Wholesaler-Distributors

The recently passed American Recovery Plan included $350 billion in aid to states and localities. The provision was controversial in part because at least 31 states reported no revenue shortfall and therefore had no need for federal aid. According to an early data analysis by the Tax Foundation, “states closed out calendar year 2020 with only $1.7 billion less revenue than they generated in 2019 (a decline of less than 0.2 percent), not counting federal assistance, while municipal governments actually experienced substantial revenue growth due to rising property values.”

In response to the controversy over the state aid, Senate Majority Leader Chuck Schumer (D-NY) offered an amendment that would prohibit any state receiving federal aid from cutting state taxes – directly or indirectly. The amendment was offered at the last minute, with no notice, after a marathon 24-hour Senate session. Senators becoming aware of the amendment after the bill was passed reacted angrily to its inclusion. And the reaction from the states, especially those in which state legislatures were already considering tax legislation, was even stronger. Questions immediately arose as to the constitutionality of the federal government mandating what legislation a state legislature may enact.

As of this writing, at least one state attorney general has filed a lawsuit challenging the Schumer language, and 21 additional attorneys general have notified U.S. Department of the Treasury that they will consider a legal challenge if Treasury does not narrow the broad scope of the language. How this issue will impact your state taxes remains to be seen.
 

March 29, 2021

President Biden Expected to Sign Bill Allowing for Applications Until May 31

Summarized from Jade West, National Association of Wholesaler-Distributors

The Paycheck Protection Program, enacted a year ago, has been extended several times, and was set to expire on March 31. Last week the House of Representatives passed yet another extension of the program.

On Thursday, March 25, an amendment to the legislation was offered by Sen. John Kennedy (R-LA) to bar loans for anyone “convicted of a felony in relation to a riot or civil disorder during the two-year period preceding the date of the application.” Additionally, Sen. Marco Rubio (R-FL) offered an amendment to limit the Small Business Administration’s ability to prioritize any particular category of borrower over another. Both amendments failed on almost-party-line votes.

Following defeat of the amendments, the Senate passed the House bill, extending the deadline to applying for the program until May 31, with the SBA having until June 30 to process loans. President Joe Biden is expected to sign the bill when it reaches his desk.