The new tax legislation will limit a company’s ability to write off interest paid on debt, and that could hurt more leveraged firms–this according to a recent article in The Wall Street Journal.

The article states, “Full deductibility of interest has long made borrowing more attractive for companies when they needed money, instead of raising capital through selling equity,” and adds that the new tax law will limit deductible interest payments to 30 percent of a company’s EBITDA (earnings before interest, taxes, depreciation and amortization) with the parameters tightening further by 2022.

Early last month, the article reports, Moody’s Investors Service said that “many speculative-grade companies would be hurt if deductibility were limited—26% of them under the House plan and 36% under the more restrictive Senate plan, especially those with ratings deep into junk territory.” Moody’s said the tech, healthcare and aerospace sectors (which are typically highly leveraged and show “significant” acquisition activity) would be the most heavily affected, and that the tax change could make weaker companies more vulnerable during and earnings downturn. Moody’s also argues that limiting interest deductibility could affect the private-equity business, since its model is based on borrowing heavily to purchase companies.