America’s farmers and ranchers need a flexible tax code that gives them freedom to both grow and adapt quickly to changes beyond their control, the American Farm Bureau Federation told Congress today.
Pat Wolff, senior director of congressional relations for AFBF, addressed agriculture’s need for sweeping tax reform in a hearing before the House Agriculture Committee.
“Running a farm or ranch business is challenging under the best of circumstances,” Wolff said. “Farmers and ranchers need a tax code that recognizes the unique financial challenges that impact them.”
Wolff urged Congress to create and retain tax policies that support high-risk, capital-intensive businesses like farms and ranches. Farm Bureau supports many of the provisions in the House’s proposed blueprint for tax reform, including reduced income tax rates, reduced capital gains taxes, immediate business expensing, and estate tax repeal. But, Wolff explained, the plan can be improved by reinstating benefits like the deduction for business interest expense and guaranteeing the continuation of stepped-up basis, cash accounting and like-kind exchanges.
“Farming and ranching is a cyclical business where a period of prosperity can be followed by one or more years of low prices, poor yields or even weather disaster,” Wolff said. Farmers, she added, depend on flexibility and benefits in the tax code that allow them to recover capital investments and put their money back to work on their farms quickly.
Tax reform is critical to the sustainability of American agriculture and farmers’ ability to feed, fuel and clothe the nation.
“Farming and ranching is both a way of life and a way of making a living for the millions of individuals and families that own 99 percent of our nation’s more than 2 million farms and ranches,” Wolff said. A comprehensive tax reform package must not overlook the financial tools farmers and ranchers depend on for keeping their businesses viable from one season to the next.