Farmers and Ranchers Face Business Closures as Tax Cuts Expire, Committee Members Hear

The Internal Revenue Service building in Washington. Marcnorman/iStock/Getty Images

Witness testimony before the House Small Business Committee projected the closure of more farms and ranches if the 2017 tax cuts expire in the coming months.

Russell Boeing, the president of the Texas Farm Bureau, was questioned by Rep. Wesley Hunt (R-Texas) during an April 18 hearing entitled “Paying Their Fair Share: How Tax Hikes Crush the Competitiveness of Small Businesses.”

Hunt began his comments by saying it was the government’s job to “get out of your way as much as possible” when it deals with small business owners.

The Internal Revenue Service (IRS) building in Washington, on April 15, 2019. Zach Gibson/Getty Images

“It’s my opinion that the federal government should be taxing you as little as possible. Because we are the people. This is our money.

“We are investing it back into the government, and we should be allowing you to keep it so you can invest back into your businesses,” the lawmaker went on. “That’s just an overall principle that I believe in.”

Hunt asked Boeing about the impact on farmers and ranchers if Congress let the provisions of the 2017 tax cuts and Jobs Act expire.

Boeing replied saying, “Quite simply, more and more of them will be at risk of going out of business. Their tax bill will go up. And if you can’t pay your taxes … you choose from paying a tax bill or going out of business.”

The bureau executive said there was widespread concern over the capital rate at which small businesses, farms, and ranches are taxed, as well as concern about the “death tax,” which he called “hugely important in agriculture.”

“I mean, they will make the difference between that operation continuing or not continuing, quite frankly,” Boeing said.

Impact on Small Business

The Republican lawmakers also addressed the disproportionate impact that inflation has had on small businesses, particularly those involved in the production of food.

Along with concern about the increased taxes, Committee Chairman Roger Williams (R-Texas) cited the “Democrats misnamed Inflation Reduction Act,” which allocated an additional $80 billion in funding for the Internal Revenue Service.

“With these new funds, the agency is poised to more aggressively audit America’s small businesses,” Williams said. “I promise we will be working to create an environment where businesses can thrive and grow.

Hunt said he believes American farmers and ranchers should have as much freedom as possible and be allowed, “to provide for America to allow you to provide for the world,” and said he was “blessed” to have the agriculture and ranging experts before the committee.

Hunt ended his comments by saying, “If you’re a rancher and a farmer in this country, God bless you. Thank you. Thank you for providing for this country. I cannot thank you enough.”