Toomey tours Palmer plant in support of new tax law
U.S. Sen. Pat Toomey toured the Sussex Wire facility in Palmer Township on Monday to demonstrate how one local manufacturer is benefiting from the new federal tax law.
The Tax Cuts and Jobs Act, signed into law in December, cuts the corporate tax rate from 35 percent to 21 percent and makes small reductions to income tax rates for most individual tax brackets. Manufacturers such as Sussex Wire are capitalizing on some of the changes in the tax law to give them the ability to hire more employees, expand or buy new equipment.
The company makes and distributes tiny cold formed parts that are precise and geometrically complex. Its products serve a number of industries, including medical devices, health care, automotive, defense and aerospace.
The company uses cold-forming technology to form metal wire and specialty alloys at room temperatures into highly engineered and precise, micro-miniature components.
Toomey toured the facility with Tim Kardish, Sussex Wire’s president and CEO, who discussed the variety of products his company makes and their many applications.
“What you saw here is just a tremendous example of Pennsylvania manufacturing,” Toomey said to a small group of reporters after the tour. “The tax reform we just did is going to help this company grow. This is exactly the idea behind this tax reform from the beginning.”
Sussex Wire is a global company and wants to expand its ability to invest in its workforce, Kardish said. With the new tax law, Sussex Wire can fully depreciate its capital investments in terms of new technology, he said.
“This really allows us to grow the business, hire more,” Kardish said. “It helped Sussex Wire tremendously.”
The company has 58 employees at its Palmer Township site. Over the next year, it plans to add about six employees, according to Kardish.
INVEST IN EQUIPMENT
The change in bonus depreciation in the new law could spur other manufacturers to invest in equipment.
One of the key changes affecting businesses in the new bill is the doubling of bonus depreciation to 100 percent and expansion of qualified assets to include used assets.
According to the law, a company should acquire these assets and place them into service after Sept. 27 and before Jan. 1, 2023.
“The tax bill allows us cash to invest a little faster,” Kardish said.
Kardish said that at this point, he could not see any downsides to the new tax law.
The company, at the Palmer Township site for 45 years, is looking to expand, he said.
Toomey, who lives in Upper Milford Township, said he sees a tremendous ability for companies to expand their workforce because of the new law.
“As more opportunities come along, as there’s upward pressure on wages, it will bring more people into the workforce,” Toomey said.