As the state’s largest business advocacy organization, the Georgia Chamber has worked diligently alongside state leaders and lawmakers to ensure that Georgia’s tax structure and economic policy are some of the most competitive and fiscally responsible in the nation. For over 40 years, companies have flocked to our state because of our pro-job creation philosophy. Having consistent tax and regulatory systems is common sense in a world dominated by economic uncertainty. Now, we need the Federal government to follow suit and mirror the same approach that our state leaders follow.
In 2017, the Tax Cut and Jobs Act brought about the most comprehensive tax overhaul the United States had seen in over three decades. Many of the provisions were beneficial for Georgia businesses. However, our members have identified several areas of the legislation that require immediate and significant fixes to protect small businesses and start-ups here in Georgia.
A provision found in Section 174 pertains to research and development initiatives, and starting this year, will limit how those expenses can be deducted. As companies, especially in their early years of operation, are investing heavily in new products, technologies, and processes, their upfront research and development expenses are substantial. I have heard from hundreds of Chamber members that this change disincentivizes them from engaging in new product development, posing a significant threat to the state’s innovation ecosystem. When these important deductions are stripped from our businesses, it dramatically impacts their ability to invest and hire new employees.
Another change in Section 179 previously allowed companies to invest in necessary capital equipment because Bonus Depreciation was expanded to 100% of its purchasing price. This was a good thing for small and start-up businesses. Now, changes to that practice significantly reduce the ability of companies, especially in Georgia’s robust…
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