Forget Entercom and Cumulus Media — the biggest headlines of the day came right from Capitol Hill, as top House Republicans including Rep. Paul Ryan (pictured) introduced legislation that would greatly change the U.S. tax code.
The changes could effect every business, or household, and there’s already chatter about caps to mortgage-interest deductions, bushwhacking to the corporate tax rate, and shrinking the seven tax brackets for families and individuals to four.
What it will do for broadcast media, and the ability to fully deduct business advertising expenses, got the NAB’s seal of approval.
“The Tax Cuts and Jobs Act” would trim the corporate tax rate to 20%, from 35%. Additionally, The Washington Post reports, “the ability to deduct all the costs of purchasing new equipment” is included in the bill.
The GOP-backed bill would bring an additional $1.5 trillion in debt over the next decade. Republicans counter that the reforms proposed would stimulate the economy and bring higher salaries, along with additional jobs.
And, The Washington Post also notes, deduction of medical expenses would disappear.
While much debate over the plan is already the talk of Washington, what do broadcast media owners have on the table?
The retention of the full and immediate deductibility of business advertising expenses is staying.
That brought cheers from former Oregon Senator and NAB President/CEO Gordon Smith. He said, “Local broadcasters applaud today’s House Ways and Means Committee introduction of comprehensive tax reform legislation that will grow America’s economy, specifically their decision to retain the full and immediate deductibility of business advertising expenses.”
Smith added that “study after study” has shown that advertising is a driving engine for economic growth, sustaining and supporting millions of high-paying American jobs. “Today’s legislative framework recognizes those important benefits,” he said.
Opposition to the plan from Sen. Chuck Schumer and Rep. Nancy Pelosi quickly surfaced by way of a news conference held just before 3pm Eastern.