The Florida Forestry Association supports the preservation of four longstanding timber tax provisions in the federal tax code that are key to the sustainability of working forests:
The deduction for timber-growing costs
Allowing forest owners to currently deduct timber growing costs enables them to afford forest health treatments that reduce the risk of natural disturbance and makes practices such as road maintenance, research, interest expense, taxes and protecting wetlands and wildlife habitat affordable through the duration of the long growing cycle. Forests are mostly uninsurable, requiring forest owners to bear for long periods the significant risk of destruction by fire, pests, disease and other natural disturbances.
Capital gains treatment for the sale of timber
Treating timber revenue as long-term capital gain helps provide a return on investment to compensate for long-term risk. It also promotes forest retention by removing pressure to convert timberland to other uses that generate ordinary income more quickly with less risk.
The deduction and amortization of reforestation costs
The separate deduction for tree planting recognizes the need for long-term investment in forest management and encourages the retention of the economic and public benefits from retaining land in forests.
The treatment of timberland as real property for purposes of the real estate investment trust (REIT) rules
Treating private forests as real property reflects the significant long-term capital investment made by forest owners to produce marketable trees that take 20-80 years to mature. Trees are different from inventory, because they are held for decades rather than days or months, and they appreciate rather than depreciate in value.
More generally speaking, the Association favors tax policies that encourage sustainable management of forests and that recognize the important benefits that working forests provide. Tax policies, like regulatory policies, should facilitate the forest industry’s ability to keep working forests working and providing clean air and water, wildlife habitat, green spaces, and jobs.
We also support comprehensive business tax reform that encourages economic growth and improves competitiveness.
The Association favors an increase in allowable truck weights at the federal level. The current Gross Vehicle Maximum weight on federal interstate highways is 80,000 pounds; we advocate for that to be raised to 97,000 pounds with an additional axle.
This change would mean that fewer trucks would be needed to transport material. That would put fewer trucks on the road, cut energy consumption and curb carbon output.
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