Its not only a prospective tax increase because they wont be able to use it any more, but its a retroactive tax increase because they will have to take in their LIFO reserve and LIFO reserves are really an accounting entry. Theres no cash there, NAM tax expert Dorothy Coleman said.
Although not yet a concern, the billions of dollars being pumped into the economy may beget inflationary concerns in the future. If so, liquor lobbyists also plan to warn lawmakers that repealing LIFO while the Department of Treasury floods the economy with cash may have a disastrous effect on recovery efforts.
We might be facing significant inflation, Coleman said. That combined with repeal would be devastating.
Rep. Elijah Cummings, D-Md., right, hugs Harold Schaitberger, General President of the International Association of Fire Fighters, after the Congressman spoke at the IAFF's Legislative Conference General Session at the Hyatt Regency on Capitol Hill, March 9, 2015. The day featured addresses by members of Congress and Vice President Joe Biden.