As a result of the Tax Cuts and Jobs Act passed in December 2017, 55 percent of Associated Builders and Contractors (ABC) contractor members plan to hire more employees, and 52 percent plan to invest in workforce development, according to a recent poll. In addition, 90 percent of member companies say employees have seen an increase in their paychecks.
“This Tax Day, we are celebrating the positive results of the first reform of the tax code in decades—one that will unlock the full economic potential of ABC’s 21,000 members,” said Michael Bellaman, president and CEO of ABC. “Our members are grateful to Congress and the Trump administration for reduced tax rates on C-corps and pass-throughs, higher exemptions for small businesses, the repeal of corporate AMT and the elimination of the ACA individual mandate.”
As capital-intensive, low-margin, domestically oriented businesses comprised largely of small, family-owned and closely held merit shop construction firms, ABC members feel the positive effects of tax reform.
“Due to the passage of tax reform and optimism on infrastructure and the economy, we have given our employees across-the-board bonuses, added sick leave for all hourly employees and plan to hire 50 to 100 additional workers in the next six months,” said Jay Baldwin, president of Reliable Contracting Co. Inc., a 90-year-old, family-owned road and highway contractor employing 400 people in the Baltimore-Washington area. “We will also be making significant capital expenditures, including a new asphalt plant.”
According to analysis by the U.S. Department of Treasury, the construction industry paid the highest effective tax rate of any sector of the nation’s economy—27 percent, compared to an average of 22 percent for other industries—from 2007 to 2011.