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Washington Watch

Welcome to the First Session of the 119th Congress.

Congress is back at it this week, with both Houses in session. All eyes are on the Senate as committees will continue to unveil text of their portions of the comprehensive budget reconciliation bill. The most consequential of this is the Senate Finance Committee which is expected to roll out draft legislation later this week. It is anticipated that the bill will revive and make permanent a pair of key business tax benefits—100 percent bonus depreciation and the research and development tax credit. The bill is also expected to make permanent the 20 percent deduction for S-Corporations and other pass-through structures. The House-passed bill actually bumps the deduction up to 23 percent, so look for the Senate to mirror House action on this front. Maintaining the delicate balance of support will be the primary issue confronting Senate leadership. A number of Senate Republicans do not support the state and local tax (SALT) deduction compromise in the House bill but modifying that provision threatens to upend support from House Republicans in high SALT states. Likewise, there is appetite among several Senate Republicans to extend the phase out dates for many of the Inflation Reduction Act renewable energy tax credits, but the House Freedom Caucus members have insisted that doing so would kill their support for the bill.

In the House, Agriculture Secretary Brooke Rollins is scheduled to appear before the House Agriculture Committee on Wednesday morning. She is expected to be questioned on the Administration’s trade and tariff policies. The Federation has reached out to Members on the committee to ask the Secretary about the possibility of financial support for the hardwood sector in light of current economic conditions and trade challenges.

U.S. House of Representatives - Schedule for the week of June 9, 2025

  • The House is in session

U.S. Senate - Schedule for the week of June 9, 2025

  • The Senate is in session.

 

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Cheat Sheet

June 5, 2025 


HF Meets with USDA, USTR and U.S. Commerce:  Dana Lee Cole of the Hardwood Federation and Mike Snow of the American Hardwood Export Council joined other members of the wood products industry this morning in a roundtable to discussion with officials from the U.S. Departments of Agriculture and Commerce and the U.S. Trade Representative.  The discussion focused on shared concerns the wider wood industry sector has with the pending European Union Deforestation Regulation (EUDR) including the continued inclusion requirement of geolocation information for all logs, lumber and wood products shipped to the E.U. starting in 2026.

Senate Begins Tax Bill Review Begins:  The Senate returned to D.C. this week and began work on the House passed Reconciliation bill.  There seems to be general agreement that renewal of the Tax Cuts and Jobs Act (TCJA) provisions for business will be included in a Senate version, although Senate Majority Leader John Thume clarified yesterday that full repeal of the Estate Tax is unlikely.  Maintaining the House provision which permanently increases the estate tax exemption to $15 million for individuals and $30 million for married couples, with future increases tied to inflation seems to be the more likely path.

Senate committees have begun rolling out their portions of the measure. Yesterday, the Senate Environment and Public Works Committee unveiled its draft text. Provisions in that proposal repeal a number of programs authorized by the Inflation Reduction Act, including funding to develop and implement an environmental product declaration program advertising the environmental impact/attributes of products. The Senate Finance Committee, which holds the pen on the TCJA business tax benefits as well as how the renewable energy tax credits are treated, will be the last panel to roll out text.

Trade Tidbits:

  • The Administration is focused on trade negotiations with the European Union this week.  Reports from both sides indicate talks are proceeding well, but no details have emerged. 
  • President Trump increased tariffs on imported steel and aluminum to 50% starting Wednesday, with the exception of imports from the European Union…a move most likely made to encourage continued positive progress from the ongoing negotiations.
  • The White House had been optimistically predicting a phone call between President Trump and President Xi Jinping of China all week, and a call did indeed take place this morning.  This is the first conversation between the leaders since the President came into office for his second term.  The White House had not issued any comment as of Cheat Sheet publication time although it is assumed the purpose of the call was  to discuss trade relations between the two counties.

Thoughts on the Cheat Sheet? Let us know at Hardwood.Federation@hardwoodfederation.com

 





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