Business executives in the state of Virginia are quite positive about the newly imposed federal tax reforms because they believe that it can create a spark that will encourage economic activity as well as increase profits. It is not surprise that many companies are already getting their Virginia EIN number in order to operate in the state soon.
Changes in the federal tax code were last implemented in 1986 and the most recent federal tax reform referred to as Tax Cuts and Jobs Act is deemed as the biggest reform since then. The bill was approved by the Congress and President Donald Trump has already signed on the fine print before 2017 ended. With this new tax reform, companies as well as individuals will see changes in their taxes for the income they are going to earn this 2018.
The new law still covers seven different income tax brackets but the change is with the reduction of the tax rate. For example, the nominal federal tax that was used to be 35 per cent for companies has been reduced to 21 per cent.
According to Virginia Bankers Association’s president as well as CEO, Bruce Whitehurst, this move is expected to have a positive effect. He added that members of the VBA are relieved because the deduction bank loans’ interest paid is not included in the final draft of the legislation.
Manufactures from Virginia are happy because the new law gives them permission to apply for full deductions in terms of their capital expenditures instead of waiting for many years.
Virginia Manufacturers Association’s president and CEO, Brett Vassey, said that the full implications of the new federal tax code are still being studied. Overall, they are receiving very positive feedbacks that they are expecting to receive unprecedented number of capital investment. In fact, he admitted that they are already experiencing it.
While businesses are already getting their Virginia EIN number, there are sectors that are not happy about the new tax law – healthcare companies and the hospitals. Surely, there are pros and cons to every law and all parties must learn to live with it.