(Bloomberg) -- As U.S. retailers prepare for the holiday season, they view the Republican tax bill as an “almost perfect” gift to the industry.
The legislation, which was released on Thursday, should put more money into the hands of middle-class shoppers, said David French, the National Retail Federation’s chief lobbyist. And companies will see their corporate tax rates cut to 20 percent. Unlike businesses in other industries, retailers typically don’t get many credits and deductions, meaning they currently pay something close to 35 percent, he said.
“The Ways and Means committee got it almost perfect in terms of middle-class and corporate tax reform,” French said in an interview. “We’re going to encourage members to enthusiastically support this bill.”
The NRF, the industry’s largest trade group, is now headed to the White House to discuss the next steps for the legislation. Retail lobbyists are already coming off a major victory for the industry: defeating the border-adjustment tax proposal. That plan would have punished companies that rely on low-cost overseas suppliers.
Besides bringing a windfall to shoppers, a recent NRF study also found that cutting the corporate tax rate to 20 percent could create between 500,000 and 1.5 million new jobs.
“For most retailers, their best customers are middle-income consumers,” French said. “If the middle-income consumer gets more take-home pay, that’s a win. If a lower tax rate means retailers can create more jobs and pay higher wages, that’s a win.”
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