The US Senate’s Finance Committee is supposedly considering major tax reforms for farmers and ranchers that may seriously harm agricultural production and weaken the farm industry.
Farm tax policy has been at the center of most US tax debates for the last several years. In 2010, for example, when the Obama Administration pushed to reinstate the estate tax, farm organizations like the Farm Bureau fought hard to block the plan, claiming that estate taxes could seriously undermine family farms and threaten the stability of the farm sector.
The current debate is stemming from a proposed Senate reform that would limit the amount of agricultural businesses that could use cash accounting, forcing many businesses to switch to a more volatile accrual accounting system.
“We are concerned that this change would force many agricultural businesses to pay a significant up-front tax payment and limit their ability to weather price volatility,” says Brian Kuehl, Director of Federal Affairs for Kennedy and Coe LLC. “Under this proposal, farmers could be required to pay taxes on products for which they have not yet received payment.”
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Written by: Justin Ellison / Farm Plus Staff Writer