Letter: Congress should follow farm bill’s fiscal example - The Packer

Letter: Congress should follow farm bill’s fiscal example

12/14/2012 10:17:00 AM
Robert Guenther

Tell it to The Packer | Letter to the Editor

Robert Guenther, senior vice president of public policy
United Fresh Produce Association
Washington, D.C.

As Congress struggles to avoid the dreaded fiscal cliff, it may want to look to the farm bill for inspiration.

The farm bill is the only bipartisan deficit reduction bill to pass the Senate this year, with cuts in farm subsidy programs saving $23 billion. The House Agriculture Committee-passed version saves $35 billion.

The fresh produce industry stands firm behind its desire to move the farm bill forward, and lawmakers now have the chance to do just that while avoiding the fiscal cliff at the same time.

Both Senate Committee on Agriculture, Nutrition and Forestry chairwoman Debbie Stabenow, D-Mich., and House Agriculture chairman Frank Lucas, R-Okla., are promoting the idea of coupling farm bill passage with passage of a fiscal cliff deal.

Farm bill cuts are a start, but lawmakers must make a good faith effort to match the bipartisan, fiscally responsible approach that is embodied in the farm bill.

The fiscal cliff issue should be of particular concern for many in our industry.

The term fiscal cliff refers to wide-ranging automatic tax hikes and budget cuts that start in 2013 if Congress cannot reach an agreement on broad fiscal policy.

Included, if no deal is reached, is an increase in the estate tax rate. At the moment, it is set at 35% on properties valued over $5 million.

Without congressional action before the end of the year, that rate jumps to 55% on property valued over $1 million.

This means that farmers who want to transfer property have a very narrow window of time to do so at the lower rate.

Also, the federal capital gains tax rate will increase from 15% to 20% on income of $250,000 in the absence of a deal by year’s end. The deduction for machinery purchases is also set to decrease dramatically in 2013.

The status of the farm bill has been in limbo for the past few months, and authority for most agriculture production programs expired on Sept. 30, including funding for several critical fresh produce programs such as pest management, marketing, trade, nutrition and research programs.

The industry needs these programs.

Congress has already demonstrated its ability to reach bipartisan deficit agreements with the farm bill.

Now it just needs to demonstrate it can take decisive action when the agriculture industry and the nation needs it to.



Comments (0) Leave a comment 

Name
e-Mail (required)
Location

Comment:

characters left

Feedback Form
Leads to Insight