WASHINGTON D.C.—There is talk that President Joe Biden’s administration would like to reverse the 2017 Tax Cuts and Jobs Act, which Representative Warren Davis (R-OH-8) considers one of the “wins” of the Trump administration. 

“For a long time they talked about eliminating stepped-up basis and if they reverse the Tax Cut and Jobs Act they would take the exemption back to what it was before, so cut it in half,” Davis said in a recent, wide-ranging conversation. “The estate tax is particularly bad for family farms; multi-generational families get hurt even worse if you take away the stepped-up basis.”

Landowners should also be able to take inflation into account for estate taxes and for capital gains taxes, Davis said. For example, if a third-generation farmer decides they want to sell the farm, even if they have a stepped-up basis from maybe 10 years ago, they should be able to take inflation into account. 

“None of those take inflation into account right now, capital gains or estate,” Davis said. “That’s one of the things we’re looking into is doing a bill to account for inflation, whether we draft it or co-sponsor it.”

Concerning packing house issues, Davis said those problems predate the COVID pandemic but they got a lot of attention last year. In May 2020, the Dept. of Justice (DOJ) said they were finally going to investigate the antitrust issues related to the four companies that control the market. 

It is a tightly controlled market whether you’re talking beef or pork or poultry, Davis said. The DOJ isn’t coming forward with anything as a result of that antitrust investigation.

“If you look back the last year, it was so tight on capacity that unfortunately, some animals had to be slaughtered rather than processed,” Davis said.

Davis was on President Trump’s Reopen America task force. When there was talk of using the National Guard to keep the packing houses open, Davis was all for it because it was so important to keep the supply chain moving.

“Thankfully they were able to keep them open but the concerns linger and that is why we need the results of this anti-trust investigation. Attorney-General Garland has not signaled anything on the topic yet. We’ve sent two letters saying please give us an update so hopefully there will be some level of pressure to where they will at least respond.” 

Farmers also need to keep an eye on environmental regulations, Davis said. There are those who are pushing for producers to track and report methane emissions on their farms or ranches. It is not yet clear where that will go and that is just one issue. 

Davis also encouraged farmers to look to state regulations.

“I’m federal so I can’t do anything with Ohio laws except talk to my legislators but I have encouraged them to look at Wyoming’s Food Freedom Act (The general purpose of the Wyoming Food Freedom Act is to allow for the sale and consumption of homemade foods). I think if states did more in that vein you could minimize some of the damage from bad policy at the federal level.”