Tax reform, Social Security highlight Smith round-table

Andrew D. Brosig
Posted 8/17/18

Calling his audience part of the “front line of the economy,” U.S. Rep. Adrian Smith (R-Nebraska) came home to Gering on Monday to host a round-table discussion on a variety of topics, with tax reform at the top of the list.

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Tax reform, Social Security highlight Smith round-table

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GERING, Neb. – Calling his audience part of the “front line of the economy,” U.S. Rep. Adrian Smith (R-Nebraska) came home to Gering on Monday to host a round-table discussion on a variety of topics, with tax reform at the top of the list.

Local residents filled a long table in the hospitality room at the Weborg 21 Center in Gering to pose questions – and concerns – to their local District 3 representative. Before the meeting, Smith told The Farmer he’s been hearing from individuals pleased with the tax reform packaged touted and passed by the current administration.

“I hear from a lot of folks who are very grateful for the opportunities” tax reform allows, Smith said. “Generally, (naysayers) are some groups saying someone else wasn’t benefiting. But we worked very hard to make sure roughly 90 percent of Americans enjoy tax relief.

“We’re focused on righting the ship, doing everything we can to make sure everyone benefits,” he told those assembled. “90 percent of taxpayers are experiencing the benefits of tax reform, at varying levels.”

But some of the provisions of the tax reform designed to benefit businesses by leveling the corporate tax rate at 21 percent across the board aren’t necessarily benefit businesses in western Nebraska, said Jim Gardner, a certified public accountant from Chadron, Neb. On the contrary, he said, many smaller corporations – the mainstay of the western Nebraska economic makeup – saw significant tax increases in the wake of tax reform.

“A lot of small corporations in this area are seeing a tax increase,” Gardner said. “They went from a 15 percent tax to the flat 21 percent.”

Those businesses, Gardner went on to say, were on average making less than $50,000 per year, putting them in that 15 percent tax bracket. But, when the flat tax was established, those same companies ended up paying, on average, about $4,000 more in taxes.

“These could be restaurants, flower shops – small businesses,” Gardner said. “There’s nothing consistent in tax law, it’s always changing.”

Another sector hit by what amounted to a corporate tax increase is family famers, said Alton Lerwick. His family farm in Banner and Scotts Bluff counties  incorporated and experienced the increase.

Smith said he’d be “happy to take a closer look at those dynamics,” noting a recent announcement by Apple of plans to add jobs, which he said was attributable to the tax reform.

“When we’re talking Apple, those types of corporations, that’s not what’s in western Nebraska,” Gardner said. “A lot of our clients are seeing tax increases.”

Other topics of interest during the discussion included the solvency of the Social Security system and costs for prescription drugs. One older couple questioned why they could access prescription medications cheaper through the Veterans Administration than they can through Medicare, wondering why the VA could negotiate better pricing, but Medicare can’t.

“I don’t hear from a lot of veterans saying, ‘Let’s make health care more like the VA.’” Smith replied, adding he’s heard from veterans noting the VA excludes several types of medication.

Concern was also expressed regarding the current back-and-forth on trade tariffs, particularly on agricultural goods coming out of western Nebraska and other parts of the country. 

“Tariffs are undermining our entire economy,” Smith said. “They are hurting consumers now and will continue to hurt them.”
Smith said he and others in Congress have called upon President Trump to meet with Chinese President Xi Jinping to address trade issues and tariffs.

“That’s the source of the problem,” Smith said. “To add insult to injury, the agriculture economy is
already slow.”

Trade agreements, such as NAFTA and the Trans Pacific Partnership – the 12-nation agreement Trump abandoned last year – are “the best way to reduce tariffs,” he said.

Smith also said the next iteration of the Farm Bill is expected to be taken up for final passage, after a conference committee works on it, hopefully shortly after Congress reconvenes after Labor Day.

Smith has hosted, or will be hosting, several round-table discussion meetings in and around his district, he said. The primary concerns he’s hearing, in addition to what was discussed in Gering, are labor availability, again harkening back to tax reform.

“We’re ready to look at Tax Reform 2.0, how we can take the good parts of tax reform that were temporary and make the permanent,” Smith said. “We have a growing economy. We want as many people to benefit from the growing economy as
possible.”