Economy priority one in
U.S. House
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October 29, 2011 |
This week the House of Representatives continued
to make reviving the economy its number one
priority by passing H.R. 674. This bill ended a
3 percent phantom “tax” on government contracts.
This new tax on doing business with the federal
government was immediately criticized, and its
implementation was delayed on two separate
occasions.
Despite the delays, the IRS’s final rule
stipulated that the provision would go into
effect on January 1, 2013. I cosponsored H.R.
674 because it gives our local businesses
certainty as they look forward and plan for the
next several years. They no longer need to worry
about a looming tax being held over their heads,
disrupting their cash flows and stifling job
creation. They no longer have to hope for
additional delays that would postpone this
requirement on a year-to-year basis and are
finally granted certainty that this misguided
tax will be gone forever.
But beyond giving relief to both small and large
businesses in the private sector, H.R. 674 also
offers relief to governments as well. Because
this original requirement forced federal, state
and local governments to comply with new
administrative burdens, it was criticized as far
back as 2006 as being an unfunded mandate,
increasing the costs not just on businesses but
on governments as well. This would have had
created a “double whammy” by not just decreasing
the resources available to governments to enter
into contracts and create jobs, but it would
have also made these same contracts less
affordable for businesses, reducing their
ability to hire workers.
Passing this bill was part of the House
Republican’s jobs and growth agenda, but this
bill gained bipartisan support. It passed the
House 405-16, and included both Democrat and
Republican cosponsors. Like our earlier
successful efforts to repeal a costly “1099”
reporting requirement, the passage of this bill
shows that we are serious about eliminating
unnecessary and harmful policies, and that when
possible we will reach across the aisle to do
so.
H.R. 674 now will move to the Senate, where it
joins a list of 15 other job creating bills that
await votes on the Senate floor.
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Raul Labrador
United States House of Representatives
Idaho District 1 |
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