Procurement Update from WIPP

Reps. Meek and Herger Introduce 511 Repeal Bill
Representatives Kendrick Meek (D-FL) and Wally Herger (R-CA) recently introduced H.R. 1023 which repeals the 3% withholding requirement imposed by section 511 of the Tax Increase Prevention and Reconciliation Act of 2005. This new requirement affects all government contracts as well as other payments, such as Medicare, grants, and farm payments. WIPP is deeply concerned about the potentially negative impact on all companies receiving contract payments or other forms of payment from all levels of government.

In particular, the withholding is based on revenues from government payments with no relationship to companies’ taxable income and it will impinge on company cash flows needed for day-to-day operations. In addition, the administrative costs to businesses and governments at all levels will be substantial and the process complicated to implement.

WIPP is part of the Government Withholding Relief Coalition which has lobbied to repeal this withholding in the 109th Congress and continues to lobby members of Congress in the 110th Congress. The Coalition will be sending a letter of thanks to Representatives Meek and Herger for sponsoring H.R. 1023 on Friday. Click here to ask your Representatives to support this provision.