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Vi
ew From Washington
By Tyson Redpath, The Russell Group
‘ WO n e B i g B e a u ti f u l B i l l A c t ’ I s N o w L a w
ith plenty of last-minute dealmaking and cliffhanging used on or after Jan. 19, 2025, and before 2031. The maximum votes in both the U.S. House of Representatives and amount that can be deducted for certain depreciable assets is the Senate, the “One, Big Beautiful Bill Act” was increased from $1 million to $2.5 million and the maximum
signed into law July 4 by President Donald Trump, meeting a deadline set by the president few thought could be met.
In doing so, Trump solidified his place among the most effective vote-whipping presidents to occupy the Oval Office. Passing the Senate by a single, tie-breaking vote from Vice President J.D. Vance, the law makes permanent virtually all the 2017 tax cuts originally signed into law during the first Trump administration. In doing so, the price tag of $3.3 trillion estimated by the Congressional Budget Office also includes a debt limit increase of $5 trillion to allow the U.S. Department of Treasury to continue borrowing to pay the nation’s bills.
How Rendering Is Affected
In addition to ensuring lower tax rates for corporations and individuals, the law includes several sections that are important to the rendering industry. For example, the estate gift tax exemption is permanently extended and increased from $10 million to $15 million starting in tax year 2026, with the exemption indexed to inflation annually.
Certain businesses — specifically pass-through business income from partnerships, LLCs, S corporations or self-employed individuals — will now be taxed according to individual rates or the taxes will be passed through to their owners. Under the new law, the 20% deduction for this qualified income is exempted and the exemption is made permanent. Also, 100% bonus depreciation is restored for qualifying depreciable property
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amount is phased out for property that exceeds $4 million, up from $2.5 million.
The new law doesn’t stop with tax policy. Much of the traditional Farm Bill was also extended through 2031 including the commodity program safety net covering row crops as well as the federal dairy support and sugar programs. For rendering, a long-sought increase in U.S. Department of Agriculture export promotion programs is now law. Twenty years of stagnate funding for the Market Access Program and the Foreign Market Development Program ended with a doubling of funds for both authorized by the Supplemental Agricultural Trade Promotion Program.
Although under a different name forced by Senate parliamentary rules governing the budget reconciliation process, the SATPP beginning in fiscal year 2027 provides $285 million on top of the existing trade programs permanently authorized by the current Farm Bill. For the U.S. agricultural trade balance sheet, the help can’t come soon enough.
Released after an update in May, the USDA trade forecast now shows a surging trade deficit pegged at $49.5 billion annually. Over the course of a decade, the U.S. ag trade balance has flipped from a $37.5 billion surplus to a nearly $50 billion deficit with little done to diagnose the problem or prescribe a solution. If the current trend line holds, the deficit could grow to $100 billion in just a few years’ time.
For now, the SATPP is a much-needed recompense in the “big, beautiful bill.”
www.rendermagazine.com