Nucor Public Affairs Update

Federal Policy Update

One Big Beautiful Bill a Win for Manufacturers
Congress recently passed, and the President signed, the “One Big Beautiful Bill” (OBBB), which includes tax provisions and incentives aimed at boosting growth and manufacturing investment.

The 2017 tax reform bill passed during the first Trump Administration spurred manufacturing investment, but many of its provisions had expired or were set to expire. The OBBB restores and makes permanent full expensing for capital equipment, immediate expensing of research and development costs, and interest deductibility. It also preserves the 21% corporate tax rate and the Qualified Business Income Deduction for small businesses.

Further, the OBBB expands expensing to include certain improvements to nonresidential buildings (i.e., roofing, HVAC, fire protection, and alarm/security systems), raises the expensing limit to $2.5 million in 2025, with phaseouts beginning at $4 million, and restores 100% bonus depreciation for certain manufacturing-related construction projects through a new first-year deduction for Qualified Production Property (QPP), if construction begins between 2025 and 2029. This renewal of immediate expensing is a powerful incentive for capital-intensive industries, where upfront equipment and facility investments are significant.

In addition to tax policy, OBBB includes $150 billion in new defense spending – $29 billion of which is allocated to shipbuilding – plus investments in transportation, infrastructure, and enhanced border security, including the border wall. It also expands tax credits for semiconductor manufacturing, building on the CHIPS Act’s success in reshoring chip production to the U.S.

Since the passage of the 2017 tax bill, Nucor has invested more than $20 billion to grow our company and expand our capabilities to better serve our customers. These investments have created tens of thousands of direct and indirect jobs – high-quality, high-paying jobs that are having billions of dollars of economic impact here in America.

Combined with ongoing regulatory reform and strong economic fundamentals, the OBBB sets the stage for sustained economic growth and continued resurgence of American manufacturing.

Trade Policy Dominates the First Few Months of New Administration
In its first few months in office, the Trump Administration has wasted no time in pursuing one of the President’s top priorities – changing the U.S. relationship with its trading partners and growing the manufacturing sector.

In April, the Administration fully reinstated Section 232 steel tariffs, removing prior product exclusions and country exemptions, and broadened the coverage to include additional downstream products like fabricated structural steel. In June, it doubled the steel tariff rate from 25% to 50%. The steel tariffs are having their intended impact – lowering steel imports and increasing capacity utilization at U.S. steel mills.

Global steel overcapacity – driven largely by Chinese government subsidies – has distorted the market for decades. The full reinstatement of Section 232 tariffs aims to stop subsidized Chinese steel from entering the U.S. through third countries such as Vietnam, Canada, and Mexico. Other nations are now waking up to the threat of China’s overcapacity model, which it is spreading to other industries like auto manufacturing.

Trade policy will likely remain a central issue in the coming months as the Administration continues to negotiate bilateral agreements that protect U.S. industries and ensure fair competition in the global market.