Senate Finance Committee Chairman Orrin Hatch (R-Utah) said Wednesday that lawmakers are working on a fix to a provision in the new tax law that is having “unintended effects” in the agriculture sector.
The provision in question allows farmers to deduct up to 20 percent of sales to cooperatives but not to other companies.
“Though the aim of that provision, in part, was to preserve benefits previously available to agricultural cooperatives and their patrons for income attributable to domestic production activities, the current statutory language does not maintain the previous competitive balance between cooperatives, other agricultural businesses, and the farmers who sell their crops to them, which existed prior to enactment of the tax reform bill,” Hatch said.
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The Finance Committee chairman said Sens. Chuck Grassley (R-Iowa), Pat Roberts (R-Kan.) and John Thune (R-S.D.), all panel members, are working on a solution to the issue.
“Once a suitable solution is identified, my goal is to work with my colleagues to advance legislation that can be sent to the president for his signature as soon as possible,” Hatch said.
Hatch also said he wants to ensure that the Trump administration interprets the new tax law as Congress has intended.
“I’m going to keep working to ensure that everyone recognizes and respects Congress’ role in this process and the fact that the best place to get an explanation of Congress’s intent is Congress itself,” he said.