Congress is discussing possible tax changes to the tax code. In doing so, it is essential that lawmakers take the right approach to foster economic growth. It is critical for future economic prosperity that Congress not harm job creation and recovery in the construction industry. Therefore, NAHB opposes any changes to the tax code that would increase taxes on home owners, renters or home builders.
NAHB supports homeownership and rental housing incentives in the current tax code, specifically the deductions for mortgage interest and state and local property taxes as well as provisions that encourage development of affordable housing. NAHB believes that the mortgage interest deduction and other housing tax incentives have helped the U.S. create the best-housed nation on earth.
Why It Matters
Many tax reform proposals being discussed have suggested reducing or eliminating the mortgage interest deduction; the Low Income Housing Tax Credit; the capital gains exclusion for home sales, and the deduction of property taxes, amongst others. These proposed tax increases would harm home values and force many aspiring home buyers out of high-cost markets.
On the corporate side, Congress is considering allowing immediate expensing for all business investments, with the trade-off of eliminating the deduction for business interest. Debt is the fuel for small business growth, and increasing the cost of debt will make it more difficult for small home builders to thrive.
NAHB estimates that eliminating the business interest deduction would reduce a small builder’s after-tax income by 11%. To ensure that our future tax code is truly pro-growth, Congress must maintain a business interest deduction for small businesses.
See the latest on tax reform at NAHBNow.
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