Take LIFO Repeal Off the Table: The LIFO Coalition Stands Together in Opposing New Proposal to Repeal Accounting Method
March 24, 2015
The LIFO Coalition, a group of more than 120 organizations including trade associations representing manufacturing, wholesale distribution, and retail industries, as well as companies of every size and industry sector that employ the “last in, first out” (LIFO) accounting method, today responded to Senator Ed Markey’s introduction of a bill that would offset another measure by prohibiting the use of LIFO for oil companies.
The Coalition is expressly opposed to LIFO repeal in any form and urges lawmakers to consider the ramifications to the American economy if this proposal is enacted.
“Consideration of LIFO repeal as a pay-for should be taken off the table,” said Jade West, executive secretariat of The LIFO Coalition. “For many types of businesses, including the gas and oil industry, LIFO is a legitimate accounting method that best tracks the costs of inventory and ensures adequate cash flow to replenish inventory as it is sold. Demonstrating this fact, the very companies targeted in this proposal now are paying increased taxes as a result of the decrease in oil prices. Repeal of LIFO under any circumstances is bad policy, and Senator Markey’s proposal targeting one sector out of the many that use the accounting method is a particularly unfair distortion of the tax code.”
The LIFO Coalition members stand together against any plan to repeal LIFO, an established and acceptable accounting method that has been in the tax code since the 1930s.