New Tax Plan Offers 100% Write-Offs, Exempts Taxes on Foreign Factory Sales to Boost US Manufacturing

The aptly named Bring Entrepreneurial Advancements To Consumers Here In North America Act (BEAT CHIN Act) is all about using the tax code to lure manufacturing back to the U.S. and encourage businesses to buy new equipment. It does this through two major tax changes: making a huge business write-off permanent and creating a special incentive package specifically for companies that move their production lines back home.

The Permanent Equipment Upgrade

Section 3 is the big one for nearly every business owner, from the local construction company buying a new excavator to the tech firm kitting out a new server room. This section makes full expensing permanent. What this means is that when a business buys qualified new equipment or property, they can deduct 100% of the cost immediately, rather than having to spread that deduction out over several years. This is a massive incentive to invest, because the tax break hits right away, significantly lowering the cost of new machinery.

This isn't just a future perk, either. The bill makes this 100% expensing retroactive, applying it to qualified property put into service all the way back to September 27, 2017. For businesses that have been waiting for certainty on this tax break, this is a green light to pull the trigger on those big capital purchases. For you, the consumer, this could mean faster adoption of new technologies and more efficient production lines, which theoretically should translate into better or cheaper products down the line—or at least, that’s the hope.

The 'Come Home' Incentive Package

Section 2 targets manufacturers who currently have operations overseas. It offers a powerful two-part incentive to relocate production of "substantially identical" goods back to the U.S. First, if a manufacturer moves production here, they get to write off the cost of their new factories and buildings much faster. Instead of the usual lengthy depreciation schedule for commercial real estate, these new buildings are treated as 20-year property, and they qualify for bonus depreciation. This means the manufacturer saves big on taxes in the early years of the relocation, improving their cash flow immediately.

Second, and perhaps most strikingly, the bill removes a major financial hurdle for moving: capital gains tax. If a qualified manufacturer sells the foreign property they used for manufacturing as part of the relocation, they won't have to pay capital gains tax on that sale. Imagine a company selling a multi-million dollar factory in another country; exempting that profit from taxation is a huge financial sweetener designed to make the economics of moving production a no-brainer. The catch is that the unit production here must be at least as high as what they stop making abroad, ensuring the move is a real boost to domestic capacity.

Real-World Impact and the Fiscal Question

These provisions are designed to create a boom in domestic manufacturing jobs and capital investment. If a company that makes car parts decides to move production from Asia to Ohio, Section 2 makes the move cheaper, and Section 3 makes buying the necessary robotics and equipment cheaper. This is great news for skilled trades and construction workers.

However, there’s always a trade-off. Giving businesses the ability to write off 100% of their equipment costs immediately, and exempting capital gains on foreign property sales, means the U.S. Treasury collects significantly less tax revenue upfront. While the goal is to spur growth that eventually makes up the difference, these are substantial tax breaks that will impact the federal budget immediately. It’s a classic policy choice: prioritize immediate business investment and domestic job creation, or prioritize current federal revenue. This bill definitively chooses the former, betting that the increased economic activity will pay dividends.