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August 2, 2021

Democratic Lawmakers Send Letter Supporting LIFO

On July 22, 13 Democratic House members sent a letter to House Speaker Nancy Pelosi (D-Calif.) expressing their support for LIFO, the last-in, first-first out accounting principle. For years, Congress has targeted LIFO as a potential way to raise taxes on U.S. businesses. Rep. Tim Ryan (D-Ohio) led the letter.

The letter said, “Hundreds of thousands of American businesses representing a wide array of enterprises, both small and large, use LIFO because they produce products from raw materials or feedstock that generally rise in price over time or sell products that generally increase in cost.”

It also argued, “LIFO best matches the replacement cost of goods with the revenue from inventory that is sold. This helps businesses such as manufacturers, retailers, wholesaler-distributors, and car and equipment dealers generate after-tax income that is reinvested in the purchase of replacement inventory, a cycle that is necessary for the company to remain in business.”

Lawmakers who signed the letter are: Rep. Tim Ryan (D-Ohio), Rep. Kurt Schrader (D-Ore.), Rep. Vicente Gonzalez (D-Texas), Rep. John Garamendi (D-Calif.), Rep. Henry Cuellar (D-Texas), Rep. Charlie Crist (D-Fla.), Rep. Dina Titus (D-Nev.), Rep. Jim Costa (D-Calif.), Rep. Eric Swalwell (D-Calif.), Rep. Kathleen Rice (D-NY), Rep. Marc Veasey (D-Texas), Rep. Haley Stevens (D-Mich.), and Rep. J. Luis Correa (D-Calif.).

The LIFO Coalition, which MSCI is a member of, sent letters on behalf of coalition members thanking each lawmaker for opposing a policy that would have a dramatic negative effect on the manufacturing community.