Government Affairs

July 2019 Government Update

BSCAI Submits Chinese Tariff Exclusion Request Letter to USTR

Recently, BSCAI formally submitted a letter to the U.S. Trade Representative (USTR) requesting they remove products utilized by building service contractors from “List 4” of the Section 301 Chinese tariffs. These tariffs were announced by the Trump Administration on May 13 and would apply additional duties of 25% on 3,805 Chinese products worth $300 billion.

On June 30, President Donald Trump announced he was suspending List 4 tariffs after the United States and China agreed to restart trade negotiations at the G20 conference in Japan.

The President also stated that the existing 25% tariffs on $250 billion worth of Chinese goods (Lists 1-3) will remain in effect while negotiations continue.

BSCAI urged the Administration to remove a series of products used by the industry, as a 25% tariff would result in adverse consequences for the industry and others.  For a copy of the letter or for questions, contact Kevin McKenney at kmckenney@bscai.org. 

House Passes Fairness for High-Skilled Immigrants Act

On July 10, the House of Representatives passed the Fairness for High-Skilled Immigrants Act (H.R. 1044) which would eliminate the per-country cap on employment-based visas and replace it with a “first come, first serve” system.  The bill also raises the per country cap for family-sponsored immigrant visas from 7% to 15%.

This provision would be implemented over a three year phase-in period: during year one, no more than 85% of employment-based visas may be allocated to India or China; in years two and three, no more than 90% of employment-based visas may be allocated to India or China.

Companion legislation was introduced in the Senate by Senator Mike Lee (R-UT) but it has yet to receive vote.

House Ways and Means Committee Approves Tax Extenders Bill

On June 20, the House Ways and Means Committee approved H.R. 3301, the Taxpayer Certainty and Disaster Tax Relief Act, which would retroactively extend through 2020 a series of tax incentives that expired in 2017. This includes:

  • Empowerment zone tax incentives- Annual tax credit of up to $3,000 for employees who live and work in an Empowerment Zone.  The credit is equal to 20% of the first $15,000 in employee salary.
  • Employer credit for paid family and medical leave- Employers may claim a tax credit based on wages paid to qualifying employees while they are on family and medical leave.
  • Work opportunity credit- Federal tax credit available to employers for hiring individuals from certain targeted groups who have consistently faced significant barriers to employment.
  • Employee retention credit for employers affected by qualified disasters- Certain employers that were rendered inoperable by a natural disaster and are located in a federally-declared disaster zone may be eligible to claim an employee retention credit equal to 40% of the qualified wages paid to each eligible employee, up to $6,000 (making the maximum credit $2,400 per eligible employee).
  • Estate tax reduction- Would accelerate the expiration date of the doubled estate tax exemption enacted in the Tax Cuts and Jobs Act from 2025 to 2022. 

In the Senate, Finance Committee Chairman Chuck Grassley (R-IA) and Ranking Member Ron Wyden (D-OR) recently announced the formation of six bipartisan taskforces to examine tax extenders.  In February, Senators Grassley and Wyden introduced legislation which would extend the temporary tax provisions through the end of this year.  The committee has yet to move forward with any legislation.

BSCAI will continue to track the progress of tax extenders legislation as it moves through the House and Senate. 

House of Representatives Passes FY 2020 Appropriations Bills

During the last week of June, the House passed six more appropriations bills for fiscal year (FY) 2020. The bills included funding for Agriculture; Commerce, Justice, and Science; Interior and Environment; Military Construction and Veterans Affairs; Transportation and Housing and Urban Development; and Financial Services and General Government.

The House has now passed 10 of the 12 appropriations bills required for FY 2020, with only Homeland Security and Legislative Branch remaining. The Senate has yet to vote on any FY 2020 appropriations legislation.