Congress Makes Manufacturing Tax Provisions Permanent

Less than a month after ACMA’s record-setting Composites 2025 Fly-In, Washington provided manufacturers with an extra reason to celebrate on the Fourth of July: much needed tax improvements that potentially help every ACMA member company.

Despite skepticism that a divided House Republican Caucus could come together, the House passed the Senate’s budget reconciliation package, known as the “One Big Beautiful Bill,” on July 3, following a dramatic series of overnight votes in the Senate, which passed the bill on July 1.

In the week following the ACMA Fly-In, Senate Republicans unveiled their version of the “One Big Beautiful Bill.”  Matching a key request from ACMA during our Fly-In, the Senate made full expensing of research and development and bonus depreciation for capital investments permanent. While the House included both provisions in its bill, the provisions would expire in five years. ACMA and other manufacturers have lobbied hard for these provisions to be made permanent to avoid a repeat from the 2017 tax bill, which included a five-year limit that Congress waited two years to renew.

These provisions are essential to incentivize manufacturing innovation. R&D expenses lower the cost for manufacturers to develop new products and improve production methods, such as shifting resin systems or changing molding for composites manufacturers. If these innovations require new equipment or plant improvements, bonus depreciation allows the full expensing of those purchases in the year the purchase occurs.

Our industry faces several challenges in the coming years, from regulatory pressure on styrene, supply chain uncertainty due to tariffs and workforce retention issues. These tax provisions make it easier for manufacturers to invest in their processes and facilities, offering a way to confront these challenges and remain competitive.

ACMA’s government relations staff have been working with Congress and other manufacturing trade associations for more than two years to pass these needed tax updates. Thanks to these efforts and the hard work of the over 100 ACMA members and staff meeting with House and Senate offices in June, these provisions are now a permanent part of the tax code.

ACMA’s President and Chief Executive Officer Cindy Squires praised the final version of the bill: “The American Composites Manufacturers Association congratulates the House and Senate for passing permanent tax relief for U.S. manufacturers. The certainty provided by H.R. 1 will allow composites manufacturers to more aggressively fund research and development, knowing that these costs will be able to be expensed in the year they occur. Similarly, the permanent 100% bonus depreciation provision will create an ability for manufacturers of all sizes, small to large, to make necessary investments to expand and modernize and to scale up innovation.

ACMA will work with our members in the coming months to provide further information on how to best utilize these new tax provisions.” Dan Neumann is vice president of government relations at ACMA. Email comments to dneumann@acmanet.org.