The recent surge of worry concerning a potential 2024 recession has taken center stage in the manufacturing industry over the past few weeks.
Seeing the threat of recession on the horizon, representatives in D.C. have taken it upon themselves to take steps to prevent the worst from happening.
… And those steps have come in the form of a $78 billion tax bill!
Join us today as we take a look at this recent update coming out of D.C. and what it could mean for manufacturers going forward in 2024.
Good news coming out of Washington for manufacturers recently as the U.S. House of Representatives passes a bipartisan $78 billion tax bill to help boost U.S. manufacturing.
… A bill that is a result of negotiations between House Ways & Means Committee Chairman Jason Smith and Senate Finance Committee Chairman Ron Wyden.
For manufacturers, the bill is expected to increase American businesses’ ability to expense research and development costs if such endeavors are conducted within the United States, a move intended to incentivize those businesses willing to invest within the U.S. and bolster the health of the national manufacturing community.
But, despite the final bipartisanship between House Republicans and Democrats, the road to agreement, naturally, proved to be a rocky one.
You see, it’s no secret that the U.S. political climate has been heavily divided over the past several years.
That being said, it won’t surprise anyone to hear that, in the instance of this bipartisan tax bill, several concessions and arrangements needed to be met in order for all involved to achieve agreement, with issues being raised before the vote by key groups on both sides of the aisle.
Such efforts, to help get the bill under way, include House GOP leaders opting to put up the bill under suspension of the rules, which bypasses a procedural hurdle known as a rule vote in exchange for raising the threshold for passage to two-thirds of the chamber rather than a simple majority.
Under normal circumstances, rule votes would traditionally fall across party lines, but with this democratic procedure being weaponized multiple times during recent Congressional sessions by GOP parties who have deliberately sunk rule votes in protest of how Republican leaders are handling matters, even if those matters are unrelated to the legislation they’re currently voting on, concessions needed to be made in an effort to actually get something done. …A move that did not sit too well with some in the chamber.
… And with tensions continuing to rise as we approach yet another presidential election, our representatives in the House were able to, even for a brief moment, come together and pass a tax bill that (lucky for us) has been designed to help the U.S. manufacturing industry… At least in part.
You see, in addition to working to stabilize the U.S. manufacturing industry, the tax bill is also expected to temporarily include a phased-in annual increase of the child tax credit’s maximum refundable amount from $1,600 until it hits $2,000 for its final year in 2025, as well as enhance child tax credit benefits for families with multiple children.
Speaking with Fox News Digital, Rep. Randy Feenstra of Iowa noted that the bill is also expected to help, “our farms, businesses and manufacturers compete with China by allowing them to purchase needed equipment, invest in cutting-edge research and development, hire new employees, and keep their operations profitable.”
As the $78 billion bill awaits the approval of the Senate, as individuals who live within the manufacturing world, we can only hope this trend of bipartisanship continues to the benefit of our industry.
Of course, if you’re a U.S. manufacturer currently looking to invest in U.S. based initiatives, this is great news as it is just another reason to spend money locally instead of sending your dollars to our global competitors.
If you’ve yet to consider investing within the U.S. borders, however, this is a great incentive to consider it as a financially viable option.
You see, the manufacturing competition between the United States and our foreign counterparts such as China has been on the rise over the course of the past several years and doesn’t appear to be stopping anytime soon.
As covered in a recent article, despite the fact that each nation brings its own unique attributes to the manufacturing table, the idea of our countries working together is one that has yet to come to fruition.
… And until we reach that point of successful global collaboration, it seems the powers that be are going to require a winner be crowned.
As U.S. manufacturers, we can only hope that incentives like this recent tax bill will add unforeseen value to our already valuable national manufacturing industry.
Global competition and the drive for global dominance is a story as old as the globe itself.
Until the world can reach a level of maturity that allows our businesses to work together, instead of against each other, it seems efforts like this recent $78 billion tax bill will be necessary to entice big corporate spenders to do so within their own borders, rather than help fund our competitors efforts.
… And when it comes to the domestic health of our manufacturing industry, those of us in the manufacturing trenches can only hope that this and any additional efforts to come out of D.C. to help bolster the health of the U.S. manufacturing industry in the years ahead will be successful in providing the much-needed support this imperative sector of the U.S. economy needs.
(This bill is as good a place as any to get things started.)
P.S. If you’re interested in adapting your business to the digital revolution, then Rain Engineering wants to hear from you!
Our team’s years of combined experience in the manufacturing and automation industry is just what’s needed to help your team prepare for the opportunities that lie ahead.
… And by your business joining a community like the one we have here at Rain Engineering, you can always count on having an experienced and reliable team by your side, ready to help you take on whatever growing pains you might experience along the way.