With the passage of the Trump administration’s $1.2 trillion tax cuts, railroads are looking to the future.
They want to be in the driver’s seat of the new tax reform process.
“It’s been a game changer for rail,” says James Kallman, president of the Association of National Commuter Railroads, in an interview with Business Insider.
“We’re looking to have a strong and sustainable industry that is a viable business.”
While Trump and Congress have already made significant changes to the tax code, they’re still in a position to set up a tax plan that includes the tax cuts and some changes to existing rules.
The White House announced that it would begin rolling out a framework for the tax reform package on Tuesday.
“This framework will be the foundation for the long-term growth of our industry,” Trump said in his announcement.
“We’re going to work together with Congress to make sure the tax plan includes the long term changes that will help American businesses grow and succeed in the future.”
The framework that the White House unveiled is meant to guide the tax changes through a process that would require the full support of the Republican-controlled Congress.
This is likely to include changes to individual taxes, like the so-called “pass-through” business model.
But the framework also will give the president the ability to make changes to tax law as the tax reforms take shape, according to Kallmann.
While Trump is the president of two major freight companies, his administration has been largely silent on how it plans to structure the tax bill.
The president has suggested that he will allow states to determine how to set their own tax laws, but has said that they will not have to be tied to the plan.
That means that Trump could decide to exempt certain industries, like manufacturing, from the tax overhaul.
“What we’re going for is a tax reform that is very pro-business, pro-federal,” Kallam said.
“That’s our goal, and it’s going to be a lot of work.”
For the freight industry, it’s a game-changer.
Railroads make up about a quarter of the U.S. economy, and the freight sector accounts for about a third of the country’s annual freight output.
Trump’s proposal would essentially eliminate the current estate tax, which would effectively raise the tax on railroad stockholders.
“This is the most progressive tax plan in the history of the United States,” Kavulich said.
But he added that it also would be “the most progressive on the freight side of the tax system, in terms of reducing tax rates.”
“This is a game changing plan,” he said.