It's back, only this time, bigger.
President Clinton's proposed budget for FY 2001 includes a tax hike on trade and professional associations that would increase their tax burden by an estimated $1.5 billion over five years, according to the American Society of Association Executives.
The tax jeopardizes the purposes for which the associations were created, discourages fiscal planning, and hinders investment in the areas of personnel education and training, said the ASAE, of which the AVMA is a member.
Last year at this time, the Clinton administration proposed taxing association investment income that is exempt under tax section 501(c)(6) of the Internal Revenue Code (see JAVMA, March 15, 1999, page 768).
If enacted, the first $10,000 an association earns from interest, dividends, royalties, and rents would not be taxed, but all subsequent income would fall under the unrelated business income tax.
The FY 2000 budget would have raised in excess of $1.44 billion over a five-year period.
Last year, the association community was able to convince a bipartisan majority in Congress to keep the tax increase out of the budget.
But the fight is on again.