Family Farms Said Shielded From Democrats’ Proposed Tax Hikes

  • Corporate tax rate aimed at large corporations, Vilsack says
  • Major farm group opposes bill’s federal spending, tax boosts

Small family farms and ranches are likely out of danger from proposed tax increases in Democrats’ massive spending bill, the top Agriculture Department official said Friday, reassuring American producers worried about their livelihoods.

Agriculture Secretary Tom Vilsack was responding to concerns recently expressed by the American Farm Bureau Federation, which came out in opposition to the bill earlier in the week.

“I don’t see anything in this bill that compromises the ability of family farms to stay in business,” Vilsack said at a press conference.

Major tax increases in the package (H.R. 5376) include a new corporate tax levied toward major companies that have historically ducked income tax and an income tax surcharge for Americans earning $10 million or more.

Vilsack said he “doubts very sincerely” that a 5% surcharge on the income tax bill of farmers or ranchers making $10 million annually will result in the loss of their establishments.

The Farm Bureau, which represents almost 6 million member families, publicly stood against the Build Back Better Act earlier this week, pointing to “partisan debate,” supply chain strains, inflation, and the U.S. economy’s recovery from the coronavirus pandemic as reasons to not move forward.

The House passed the tax and spending package Friday, 220-213, sending it to the Senate. The agriculture portion of the bill appears relatively stable as the Senate prepares for deliberations over the measure. There has been little opposition to it after House leaders ensured the package included $27 billion for farmers and ranchers to combat climate change through voluntary conservation programs.

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The House-passed measure would also put $10 billion over five years toward child nutrition and $6 billion in full or partial loan forgiveness to underserved agriculture producers and landowners in high-poverty communities.

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American Farm Bureau President Zippy Duvall called certain funding boosts and new programs in the package “commendable” by themselves, but he wrote in a Nov. 16 letter that the combination of increased federal spending and tax increases “will stifle economic growth and destroy jobs.”

“Ultimately, the result could be the consolidation or sale of family farms and ranches,” he wrote.

The Farm Bureau didn’t immediately respond to requests for further comment.

The Farm Bureau is unique among agriculture groups in its opposition to the tax and spending package. Many other food and agriculture groups lauded the package’s passage Friday, including the National Farmers Union, the National Sustainable Agriculture Coalition, the Alliance to End Hunger, and the Center for Rural Affairs.

To contact the reporter on this story: Megan U. Boyanton in Washington at mboyanton@bgov.com

To contact the editors responsible for this story: Fawn Johnson at fjohnson@bloombergindustry.com; Bennett Roth at broth@bgov.com

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