After much struggle from within Congress, President Trump's massive tax reform bill successfully passed. Though it's unclear exactly what effect the bill will have on individuals at this point, many industries are hailing the milestone legislation as a boon to the economy and their own businesses. Starting in 2018, the impact of the largest overhaul of the country's tax code in 30 years will be felt. Some highlights -- as they pertain to truckers and the trucking industry -- are noted below.
Truckers' Per Diem Remains
Truck drivers will be pleased to learn that President Trump's tax bill leaves the 80 percent per diem rate as is. Though the tax bill makes some changes to other per diem rates, truck drivers are not affected by these. This means that truckers can continue to claim 80 percent per diem for those nights that they are away from their home.
Corporate Rate Tax Cuts = More Money to Invest
One of the most significant portions of the reformed tax code is the massive cut in the corporate tax rate. The bill slashes the previous rate from 35 percent to 21 percent. This significant reduction means that the small businesses that are the backbone of the trucking industry can pour more money back into their companies. Upgraded equipment with a focus on fuel economy -- as well as the latest features designed to make truck drivers' lives easier -- are likely to be at the top of any shopping list.
Increased Capital Spending Deductions
The increase in allowable deductions for capital spending provides trucking companies with another incentive to purchase new equipment and upgrade systems. This increase will also spur other companies to ramp up their capital spending as well. Most of these purchases will reach their destinations via 18-wheelers.
With everyone from individuals to corporations destined to see some form of tax cuts, the extra money is expected to be plowed back into the economy. Coupled with a projected boost in business investment growth to about six percent over the next few years, the trucking industry will be called upon to ship these newly-purchased consumer goods, machinery and more.