RV retailers from across the country were sipping morning coffee at a convention in Las Vegas earlier this month when word whipped through the hotel’s “dealers’ lounge” that the U.S. Congress was considering tax law changes threatening their businesses.
Republicans in the House of Representatives wanted to jettison a part of the tax code that lets dealers of RVs, cars, boats, even farm and construction machinery, write off all the interest expense of keeping inventories of vehicles on their sales lots.
This story originally appeared on Reuters.
The RV dealers jumped on the phones to their representatives in Washington, adding to a wave of calls made by members of the powerful National Automobile Dealers Association (NADA) as well lobbyists for boat dealers and farm machinery dealers.
By the end of the day, the crisis had passed, at least temporarily. The House had backed away from repealing the tax deduction for what dealers call floor-plan interest expense, or the financing costs they incur for vehicles on their lots, but they must still convince the Senate.
NADA, which represents more than 16,000 dealers nationwide, plans to send a letter today to Senate Republican leaders, saying the group will not support a tax bill lacking the House language.
As Congress and President Donald Trump push ahead on what could be the largest tax overhaul since the 1980s, the crush of lobbyists descending on Washington D.C. is a reminder that no legislation sweeps across American interests quite like a tax bill.
Floor plan interest deductibility has been part of the tax code since 1918. The deduction costs the U.S. Treasury about $300 million a decade which is not much relative to the $4 trillion annual federal budget, but Republicans are looking at every source of new federal revenues they can find to offset the costs of deep cuts they want to make in corporate tax rates.
