U.S. Senator Cindy Hyde-Smith from Mississippi has introduced a bill aimed at supporting the American hardwood industry by making solid American hardwood products eligible for federal tax credits. The proposed legislation, known as the Solid American Hardwood Tax Credit Act, seeks to enable consumers to claim tax credits when purchasing these products for home improvements. This initiative is designed to bolster an industry that has been struggling due to economic challenges.
The bill would classify solid American manufactured hardwood products as qualified home energy efficiency improvements under the Energy Efficient Home Improvement Credit. Eligible products include flooring, paneling, millwork, cabinetry doors and facing, windows, and skylights made from deciduous trees grown and processed in the United States.
Hyde-Smith emphasized the importance of this measure: “Mississippi’s sawmills and rural communities that depend on timber have been hit hard by the same economic challenges facing the entire industry. This bill is designed to support the domestic hardwood industry and the jobs it provides while making American-made hardwood products more affordable for families.”
She added that the goal is to preserve rural manufacturing jobs and encourage environmentally sustainable wood products over synthetic alternatives: “Our goal with this legislation is to preserve rural manufacturing jobs and sawmill operations that are critical to local economies and national security supply chains, while encouraging the use of environmentally sustainable wood products over cheap, Chinese-made synthetic alternatives.”
The domestic hardwood industry in Mississippi has faced significant decline over recent decades. The market for domestic hardwood-grade lumber has decreased dramatically from 6.5 billion board feet to less than 2 billion board feet over 26 years. Much of this decline results from competition with foreign substitutes.
The proposed act aims to amend the Internal Revenue Code so that American hardwood products qualify for home improvement energy efficiency tax credits under Section 25c. The cost of implementing this bill would be offset by removing a bonus tax credit established by the Inflation Reduction Act (IRA), which currently benefits carbon capture projects if union labor requirements are met.
Additionally, Hyde-Smith’s proposal aligns with a March executive order issued by President Trump calling for expanded American timber production and improved forest management strategies.
The Senate bill accompanies a House version (HR.3322) introduced by House Agriculture Committee Chairman Glenn “GT” Thompson from Pennsylvania and U.S. Representative Terri Sewell from Alabama. The National Hardwood Lumber Association endorses this legislative effort.
