In late April of last year, the U.S. Senate proposed a permanent repeal of the use of the "Last-In, First-Out" (LIFO) inventory accounting method-an action that would translate into a massive tax increase for hundreds of thousands of American businesses.

The restricted use or outright repeal of LIFO is likely to have far-reaching and potentially damaging effects on any company within the professional beauty industry that relies on effective inventory management to remain profitable. Distributors, which by definition hold and maintain extensive inventories, could be seriously impacted by a loss of revenue through a largely increased tax burden.

Although the proposed repeal of LIFO was defeated last year, it is very likely that this topic will resurface-particularly given the increased pressure from Congress to close the federal "tax gap". To learn more about this issue, please visit sam@probeauty.org and read the PBA Issue Update to learn more. Also, PBA is very interested in knowing how many of our member-companies use LIFO inventory accounting. Please contact Sam Leyvas, PBA's Government Affairs Director, directly at sam@probeauty.org or 800-468-2274 x118 to let us know if you use LIFO, or if you would like more information.