In April, the Equipment Dealers Association (EDA) and the Association of Equipment Manufacturers (AEM) surveyed their members about the impact of the Tax Cuts and Jobs Act and steel and aluminum tariffs on their businesses. This was the first of several Policy Pulse surveys that will be conducted in 2018.
The survey identified eight provisions of the new tax code and asked respondents to rank them from the most beneficial to the least beneficial for their company’s respective operations. Dealers and manufacturers were in consensus that the two most beneficial provisions were (1) the lower corporate tax rate and (2) the favorable expensing provisions for new and used equipment. When asked if there were any troubling components of Tax Cuts and Jobs Act, survey takers uniformly agreed that there were no provisions which they believed were negatively impacting their businesses.
While dealers and manufacturers are singing the “same tune” with respect to tax cuts, there were substantial differences in their opinions related to the recent trade tariffs imposed by the Trump Administration on steel and aluminum. One surprising discrepancy was the opinion on how these tariffs would impact the U.S. economy. Although a substantial number of survey takers stated that they believe these tariffs will negatively impact the U.S. economy, it appears that a smaller percentage of dealer participants held this sentiment as compared to manufacturer participants. Only 45.5% of dealers said that the tariffs would negatively impact the economy as compared to 61.9% of manufacturers who said the same.