COLUMN: Tax Relief Framework Released for American Families and Businesses
As a conservative who believes in the free market, I believe that American businesses hire more workers and families thrive when you are able to spend and invest more of your own hard-earned paychecks. The complexity and distortions created by our current broken tax code are holding back economic growth and job creation.
Simplifying the tax code to make it more fair and allowing our businesses to be more competitive will help realize our nation’s economic potential. That is why last week, House Republicans released the unified framework for pro-growth tax reform.
It has been more than 30 years since the nation’s tax system was overhauled under President Reagan. Now, President Trump has laid out four principles for tax reform:
First, we want to make the tax code simple, fair and easy to understand. Under the current code, the average taxpayer slogs through 241 pages of instructions for a single basic tax return. 94% of taxpayers need professional help and together spend 6 billion hours to file in compliance with the current system. This level of complexity not only creates unfairness, but it is also unnecessary. Our plan lowers tax rates at all income levels, consolidating the current seven tax brackets into four brackets of 0%, 12%, 25% and 35%. By simplifying rates, our plan will allow the vast majority of Americans to file their return on a single page the size of a postcard.
The second principle for reform is to give American workers a pay raise by allowing them to keep more of their hard-earned paychecks. The plan significantly increases the child tax credit and adds a $500 credit for families that care for dependents that are not children, such as elderly family members. We want to double the standard deduction to $24,000 for married taxpayers who file jointly and $12,000 for single filers. Increasing the standard deduction effectively creates a larger “zero tax bracket” for low income Americans. Our framework eliminates the Death Tax to allow families to pass on the fruit of their efforts to the next generation. We will also retain deductions for charitable donations and interest on mortgages.
Third, the goal is to make America the jobs magnet of the world by leveling the playing field for American businesses and workers. Our framework limits the maximum tax rate for small businesses to 25% and reduces the corporate tax rate so that American businesses are no longer at a disadvantage to global competitors.
Finally, our goal is to bring back trillions of dollars that are currently kept offshore to reinvest in the American economy.
I am working to reform the tax system to strengthen our nation’s economy and job opportunities for Americans. You can read the framework for yourself at www.fairandsimple.gop. I look forward to working the President and with my colleagues in the House and Senate to make pro-growth tax reform a reality for middle class families and small businesses in Washington.