Portman, Stabenow, Brown Introduce Bill to Support U.S. Manufacturers, Promote More American Jobs “This legislation will help ensure our tax code encourages good-paying manufacturing jobs right here in the United States,” said Portman.
PoliticalNews.me - Mar 19,2017 - Portman, Stabenow, Brown Introduce Bill to Support U.S. Manufacturers, Promote More American Jobs
WASHINGTON, D.C. – Senators Rob Portman (R-OH), Debbie Stabenow (D-MI), and Sherrod Brown (D-OH) introduced legislation – the Promoting More American Manufacturing Jobs Act – to clarify the domestic manufacturing tax deduction for U.S. manufacturers. The legislation clarifies the intent of Congress in enacting the domestic manufacturing deduction, section 199 of the tax code, to ensure that in contract manufacturing situations, any party to the arrangement that makes a substantial contribution to the manufacture of qualifying goods through its U.S. employees is entitled to claim the deduction.
“This legislation will help ensure our tax code encourages good-paying manufacturing jobs right here in the United States,” said Portman. “The IRS’s interpretation of the section 199 regulations has resulted in unnecessary disputes and litigation between the IRS and contract manufacturers and, as a result, it has diminished the law’s intended purpose of promoting more American manufacturing. This bill will end those disputes so that businesses can get back to focusing on creating more jobs.”
“We don’t have an economy or a middle class unless we make things and grow things,” said Senator Stabenow. “This bill makes a commonsense change to our tax policies that will encourage manufacturers to create more jobs here at home.”
“When U.S. manufacturers provide American jobs with good benefits, they should be rewarded,” said Brown. “This simple fix will promote job creation by making sure American manufacturers can get the tax deduction they need to grow.”
NOTE: Congress added the Domestic Manufacturing Deduction (DMD) to the Internal Revenue Code as part of the 2004 Jobs Act in an effort to encourage U.S. manufacturing and domestic job creation. Application of the DMD to fully integrated manufacturers is relatively clear, however, the IRS has implemented and applied regulations relating to the domestic manufacturing deduction in a manner that does not benefit most U.S. manufacturers that rely on contract manufacturing, even though both types of domestic manufacturers make similar contributions to U.S. job creation. The bill would eliminate the unfair different treatment of manufacturers with vertically integrated and non-vertically integrated supply chains.