Contributed by Nicole Schmoll, AAF Omaha Board Member and Legislative Issues Chair
Threats to Advertising and New Leadership
Republican Tax Reform Proposal Threatens Deductibility of Advertising
Clark Rector, Jr., Executive Vice President of Government Affairs for AAF, noted in his Government Report dated September 27 that the Unified Framework for Fixing our Broken Tax Code presents a threat to the advertising industry. The plan itself would reduce the corporate tax rate to 20%. Many of the specific details are yet to be determined, but in order of offset the loss of revenue because of the significant rate reduction for businesses, “numerous special exclusions and deductions will be repealed or restricted.”
The plan as released is silent as to exactly which exclusions and deductions will be targeted. However, Treasury Department officials and senior legislative aides to members of the tax writing committees from both side of the aisle have confirmed to AAF and other advertising industry representatives that advertising is still very much being considered as a deduction that may be reduced or eliminated.
The last comprehensive tax reform proposals released in 2014 by then Ways and Means Chairman Dave Camp, R-Mich. and Finance Committee Chairman Max Baucus, D-Mont. would have paid for lowering rates by, in part, limiting the current year federal tax deduction for advertising to 50% and amortizing the rest over ten (House) or five (Senate) years.
AAF continues to meet with Administration and Congressional officials and aides to explain to them that advertising is a key driver of the economy and that increasing the tax burden on advertising would be counterproductive to their goals of growth and spurring economic activity which they are counting on to increase tax revenues.
AAF has also sent an alert to members urging them to contact their Senators and Representatives and urge them to oppose any effort to tax advertising.
The AAF Omaha and Lincoln Legislative Committees are working to draft a letter writing campaign that will effectively engage the Nebraska Congressional Delegation to oppose any effort to reverse the current deductibility of advertising expenses for businesses. We will keep membership updated as progress continues.
New Leadership at NAD and CARU
From the AAF Government Report – “The Advertising Self-Regulatory Council (ASRC) and Council of Better Business Bureaus (CBBB) have announced the appointment of new leadership for both the National (NAD) and Children’s Advertising Review Unit (CARU).
Laura Ulrich Brett has been named Director of the NAD and Dona J. Fraser has been named Director of the CARU. Policies and procedures for NAD and CARU are set by the ASRC. The ASRC self-regulatory system is administered by the CBBB.
AAF is a proud supporter of the advertising industry self-regulatory program, which has often been recognized as one of the premiere industry self-regulatory programs. Self-regulation increased confidence in advertising and is good for the industry and consumers.”