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U.S. House Passes Rep. Byrne’s Small Business Bill

The U.S. House this week passed U.S. Rep. Bradley Byrne’s “Save Local Business Act,” which he introduced to roll back National Labor Relations Board vague and expansive joint employer standards that will give small businesses and their employees peace of mind knowing they cannot be held responsible for actions of a parent company.

“For a few years now, I’ve visited local businesses and heard concerns about how the joint employer scheme creates confusion and uncertainty for workers and job creators,” Rep. Byrne said. “As someone who practiced law in this field for years, I have no doubt today’s vote will make things easier for small businesses throughout the country and help clear the air of uncertainty.”

Rep. Byrne said the bill, which goes to the Senate, if it becomes law, does not change the definition of employer but reverts to the definition of joint employer prior to an NLRB ruling in 2015, which “upended labor law as we knew it.”

The ruling brought locally owned franchise employees under a corporate umbrella that potentially opened them up to lawsuits aimed at deep-pocket employers. Rep. Byrne said the same important protections exist as before and any irresponsible employer can be held accountable for his or her actions.

Byrne, chairman of the House Workforce Protections Subcommittee, is a Republican lawmaker from Fairhope.


SENATE NOW HAS ITS VERSION OF TAX BILL, COULD DERAIL TRUMP’S PLANS UNTIL 2019

Senate Republicans on Thursday were to unveil a tax-reform bill that differs significantly from legislation in the House, setting up a battle within the GOP as it tries to hand President Trump his first major legislative victory.

The Washington Post reports that the Senate version may delay a corporate income tax cut from 35 percent to 20 percent until 2019, after the 2018 mid-term elections.

That one-year delay could cost business taxpayers $100 billion. In exchange, instead of forcing companies to wait until 2019 to invest under favorable tax rules, some Republicans may propose to allow companies to immediately deduct all capital investments in 2018 as an incentivize to spend more and keep the economy rolling.

One of the Senate’s tax proposals is a change in the House formula for taxing small businesses with a new “pass-through” rate of 25 percent, the Hill reported. Republicans say businesses with large capital expenses will see lower rates compared with the House bill, which would tax 70 percent of small-business income at the individual tax rate and 30 percent at the new pass-through rate.

The Senate Finance Committee was to share details with Republican senators on Thursday and then take up the bill after Thanksgiving.

Another key feature in the Senate bill might be a formula for small businesses that have greater capital investments, which in the House bill wouldn’t benefit from the proposed cut in the corporate income tax rate.

Instead of taxing 70 percent of pass-through income at the individual rate, there’s support for taxing only 50 percent at that level and the remaining 50 percent at the lower 25 percent pass-through rate, the Hill reported.

The outcome of two gubernatorial races and a state legislative race that swung to the Democrat side of the ledger (Virginia stayed Democrat, but New Jersey voters replaced a Republican governor with a Democrat) may affect the narrow Senate majority and its ability to pass tax reform this or any month.

Democrats are touting the election results as a knock against President Trump’s popularity and influence and could slow the process even to the extent of seeking a government shutdown after the Dec. 8 continuing funding resolution expires and blaming the incumbent political party.

Tax reform plans contain an aspect of repealing Obamacare, which is opposed by Democrats. Some Republicans are nervous about that possibility and could affect the timing and details of tax reform.

Here’s a compendium of tax reform views posted by the U.S. Chamber of Commerce.

The Chamber’s position on tax reform can be read here, and the position of the National Association of Manufacturers can be read here.

The Business Council of Alabama is the exclusive representative of the U.S. Chamber and the NAM in Alabama.


IN CASE YOU MISSED IT

Economists See Few Monetary Policy Changes with Powell Leading Fed
The Wall Street Journal (Harrison 11/9 subscription) “Economists surveyed by The Wall Street Journal this month expect that a Federal Reserve led by … Powell would mean little change in monetary policy and a less aggressive approach to financial regulation. Most survey respondents expect the Fed to raise short-term interest rates next month and lift them three times next year and twice in 2019, in quarter-percentage-point moves. That would match the projections penciled in by Fed officials in September. They will update those forecasts at their next scheduled meeting, Dec. 12-13.

President Donald Trump last week nominated Mr. Powell, a Fed governor, to serve as the next central bank chairman after Janet Yellen’s term as chief expires in February. Overall, economists expressed few qualms about Mr. Powell at the helm, with almost 96% saying he is qualified to lead the Fed. Mr. Powell, a lawyer, has worked at an investment bank, at the U.S. Treasury Department, as a partner in a private-equity firm and as a Fed governor since 2012.

“If confirmed by the Senate, as is likely, Mr. Powell would be the first Fed leader in 30 years not to have a Ph.D. in economics, but the economists surveyed didn’t think that would be a drawback. Roughly 88% of the economists surveyed said the Fed led by Mr. Powell would pursue the same monetary policy as under Ms. Yellen, while 12% said it would be more inclined to tighten. At the same time, more than two-thirds of respondents said they believe the Fed would ease up on its regulatory efforts somewhat under Mr. Powell’s leadership.”

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