According to a recent National Electrical Manufacturers Association (NEMA) survey of electrical manufacturers, 53% said that the Tax Cuts and Jobs Act (TCJA) has already had a net positive impact on their businesses, while an additional 34% are waiting for full implementation before they can assess the benefits of the legislation.
“A new NEMA survey indicated positive outcomes from the Tax Cuts and Jobs Act. However, electrical manufacturers identified three issues that, when resolved, will unlock the fullest benefits of the legislation,” says NEMA President and CEO Kevin Cosgriff. “Specifically, a drafting error impacting the definition of qualified improvement property, base erosion anti-abuse tax, and global intangible low-taxed income would greatly benefit from clarifying language.”
Nearly one in three electrical manufacturers surveyed said they had already made investments in employee salaries and benefits, domestic employment, equipment, or research and development. The NEMA survey also found that 53% intend to take actions because of the TCJA. Of those manufacturers, nearly 74% intend to increase domestic employment, 71% intend to invest in new equipment, 66% will invest in research and development, and 64% will increase employee salaries, bonuses, or benefits.
In oral testimony June 20, 2018, to the House Energy and Commerce Subcommittee on Energy, AMAMET Electrical President Sam McCammon echoed the NEMA survey results, citing that AMAMET had made investments in its employees and equipment as a result of tax reform.
“After foregoing pay raises for consecutive years, we were finally able to give our employees a much-deserved wage increase,” McCammon says. “Because of the increase in the Section 179 deduction limit from 100% of $500,000 to 100% of $1,000,000, and 50% above $1,000,000, ANAMET is planning to increase our capital expenditures in 2019 by more than 100% from normal investment levels, which will better position us among our competition.”
“NEMA will continue working with lawmakers to modify the legislation so that its fullest potential can be realized,” adds Cosgriff.
For more information, visit www.nema.org.