Complete Story
05/22/2017
Lawmakers: Leave advertising tax break alone
Industry groups and more than 100 lawmakers want to prevent tax reform legislation from curbing the deduction for businesses’ advertising expenses.
Since the federal tax code was created in 1913, businesses have been able to immediately deduct their full advertising costs. But over the years, proposals to limit the deduction have been floated as a way to raise revenue.
President Trump and Republicans have made passing tax reform legislation one of their top goals for 2017, viewing it as the path to stronger economic growth and job creation.
But the tax reform push has set off a lobbying scramble, with business groups and lobbyists seeking to protect certain tax breaks — and the ad deduction is among those with defenders.
Officials in the advertising and media industries and a bipartisan group of lawmakers argue that the tax treatment of ad expenses is consistent with the GOP’s goals for tax reform.
“The potential for strengthening our economy through tax reform would be jeopardized by any proposal that imposes an advertising tax on our nation’s manufacturing, retail and service industries,” 124 members of the House said in a recent letter to congressional leaders. The leaders of the letter were Reps. Kevin Yoder (R-Kan.) and Eliot Engel (D-N.Y.).
The intensity of the backlash highlights how hard it will be to overhaul the tax code; many of the breaks that lawmakers will need to close to raise revenue to lower rates have big business backers.
