From the PRI Washington, D.C., office

President Trump signed H.R. 1, the "One Big Beautiful Bill Act," into law on Friday, July 4. The new comprehensive tax law permanently extends several key tax incentives for businesses and expands several long-standing pro-growth tax policies in the coming years.  

The PRI-supported law provides tax certainty to American businesses and includes several key provisions that benefit PRI members and industry companies, making this a massive win for motorsports businesses.  

Key provisions in the new law include:  

• Tax Rate Certainty: Make permanent the current tax rates for individuals and pass-through businesses, which were scheduled to increase at the end of 2025. 
• 199a deduction made permanent: Pass-through businesses will permanently be able to deduct 20% of their business income. 
• Section 179 expensing: Raises the cap for small business expensing under Sec. 179 from $1,000,000 to $2,500,000, with a higher phase-out threshold. Sec. 179 covers investments, including cars/work vehicles, office equipment, business machinery, and computers. 
• Full expensing for R&D and capital investments: Permanently allows 100% immediate expensing for research & development (R&D) and investments in qualified property acquired on or after January 19, 2025. 
• Depreciation allowance for qualified production property: Allows 100% immediate deductibility of certain investments in new factories and improvements. 
• Expanded business interest deduction: Newly eligible deductions include any trailer or camper that is designed to provide temporary living quarters for recreational, camping, or seasonal use and is designed to be towed by a motor vehicle. 
• Estate exemption: Increases and permanently extends the estate and lifetime gift tax exemption to $15 million per person (indexed to inflation), which was previously scheduled to drop to $7 million per person in 2026. 
• State and Local Tax (SALT) Deduction Cap: Increases the SALT deduction cap from $10,000 to $40,000 annually for households earning up to $500,000 through 2029. The SALT deduction will return to a maximum of $10,000 in 2030. 
• New markets tax credit: Permanently extends this tax credit to increase investment in low-income communities. 

The law also includes several automotive-specific provisions that will impact both the vehicles that automakers produce and incentives associated with purchasing new vehicles, including electric vehicles (EVs): 

• EV tax incentives: The law eliminates the EV tax incentive ($7,500 for the purchase of a new vehicle and $4,000 for a used EV) starting on October 1. 
• CAFE: Fuel economy penalties are now eliminated. These penalties had previously incentivized automakers to produce more fuel-efficient vehicles to avoid penalties. 
• Buy American Incentive for Vehicles: A new, major provision encourages the purchase of American-made cars, trucks and SUVs. From 2025 to 2028, individuals can deduct up to $10,000 if they buy an American-made vehicle. These deductions decline past taxable income thresholds of $100,000 for individuals and $200,000 for joint filers. 

PRI thanks those in the Senate and House of Representatives who engaged with and listened to members of PRI's community of aftermarket businesses and automotive enthusiasts to ensure that pro-growth legislation champions businesses of all sizes and gives entrepreneurs the tools they need to compete in today's economy.  

Questions? Reach out to Juan Mejia, SEMA's senior manager for federal government affairs, at JuanM@sema.org. 

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