3 Policy Issues to Watch
During his campaign, President Donald Trump promised several policy changes that would benefit agriculture. Here’s a look at three of those top issues and where they stand.
1 Tax reform. During negotiations, it’s possible the business interest exemption, which allows farmers to write off the interest paid on business loans as an expense, could be eliminated, notes John Dillard of OFW Law, based in Washington, D.C.
“I’m not sure [the business interest exemption] will pass because it would affect so many farmers, but it’s worth watching,” he says.
The Trump administration has a pretty aggressive timeline for this reform, adds Jim Wiesemeyer, Pro Farmer’s Washington policy analyst.
“If they can get that done in the first few months of 2018, the market will have to build back in what they previously factored in right after the Trump administration win,” he says.
2 2018 farm bill. As Congress goes to work on a new version of the farm bill, risk-management provisions for producers are the front-running topic of discussion among lawmakers.
“There is going to be a strong argument for a robust safety net,” Dillard says, “but not all members of Congress necessarily value increasing the investment in the farm safety net.”
It’s unclear what exactly will happen with crop insurance, Dillard says, but it’s unlikely there will be a return to direct payments.
3 NAFTA modernization. Agriculture leaders from all three NAFTA countries are encouraging negotiators to “do no harm,” says Zippy Duvall, president of the American Farm Bureau Federation. “This has been a good trade treaty for North American agriculture, and we want to make sure we have our voices heard,” Duvall says.
Some say negotiators must do more than simply leave agriculture tariffs alone but be mindful of the domino effect to avoid harm. “It’s making sure that the elements you negotiate don’t create such an imbalance that you provide an incentive for Canada and Mexico to retaliate against the agricultural products we ship,” notes Darci Vetter, former ag negotiator for the U.S. trade representative.