Today, Republicans unveiled the Tax Cuts and Jobs Act. If passed, the bill would simplify the tax code to four brackets – 12 percent, 25 percent, 35 percent, and 39.6 percent – and amount to a $1.51 trillion tax cut over the next decade.
The full 429-page legislation can be found here.
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“Letting Americans keep more of their hard-earned money and determine their economic future is always good for the economy and individual freedom. With this bill, tax reform is headed in the right direction, but there is so much more to do. Unlike their efforts on Obamacare, let’s hope congressional Republicans listen to the president and the American people, not the thousands of lobbyists and other Beltway insiders who support the 75,000-page status quo tax code.”
Dr. Huelskamp represented Kansas’ 1st District in the House of Representatives from 2011 to 2017.
“Flattening taxes and lowering the rates is always a good idea, though the offsets in this plan, necessitated by congressional rules, reduce some of the value of these changes. Overall, however, tax cuts are always beneficial.
“The cuts to the corporate tax and the levies on small businesses in particular will spur significant economic growth, as will the reforms of taxes on income earned overseas and the foreign earnings repatriation plan. These are much-needed reforms.
“Overall, this tax reform will probably result in a significant increase in tax revenues for the national government, by increasing economic growth. Congress will have to be careful not to go on a spending spree when the additional money begins flowing in, instead applying it to debt reduction. The national debt has reached the danger level, and the only honorable thing for Congress to do is to use any revenue increases to cut that debt load.
“Of course, using the words ‘honor’ and ‘Congress’ in the same sentence indicates the magnitude of the problem that remains.”
“It’s finally here! The Tax Cuts and Jobs Act was released today, after some minor delays. By compressing the federal tax structure’s current seven tax brackets into four brackets, the plan would reduce tax burdens for low- and middle-income earners and would reduce the pain points at which earning extra money and working harder pays less.
“The Tax Cuts and Jobs Act also puts the federal ‘death tax’ into end-of-life care, doubling the exemption and setting a timetable for its ultimate termination, which would occur in just six years. The death tax, a tax on the value of goods and property already taxed during the owner’s life, forces families to quantify their deceased loved one’s assets and pay the tax man during what is already an emotionally traumatic time. No one will be attending the death tax’s funeral, unless they’re visiting to say, ‘Good riddance to bad policy!’
“Now that a tax bill has been written and released, it’s up to Congress to refine the bill and pass it sooner, rather than later. Time is running out for Congress in 2017, and Americans can’t afford to wait another day for relief from government’s ever-expanding intrusion on our lives and wallets.”
“All I want for Christmas is for Congress to give Americans a tax cut, and this plan would do that. The House tax plan cuts taxes for most Americans, simplifies the tax code, and will help make American businesses competitive again, by finally bringing our corporate tax rate in line with the rest of the industrialized world. No tax plan is perfect, but this is a step in the right direction and would put more money back into the pockets of Americans, where it belongs.”
“The House tax bill represents a major pro-growth policy change. Sharply lower tax rates will increase jobs and real growth, further extend the bull market in stocks, and mark the beginning of a new era of economic prosperity.”
“The proposed tax cuts are an improvement, especially the corporate tax rate, but why not implement a 15 percent corporate tax? The capital gains tax should be 5 percent. We don’t need a tax bill that tacks 400 pages onto the already very complex tax code and its interpretation (now 70,000+ pages). What we really need is a repeal of the current tax code and a new code that runs to maybe a couple hundred pages. Progressive taxes should be repealed, since they are unconstitutional. That would be real ‘tax reform.’
“We don’t need a tax bill that adds to the deficit. There are several very effective and obvious ways to avoid this: (1) cut out government waste already identified by agencies ($600 billion); (2) sell federal government lands that dominate some Western states (generating $1 trillion, without even trying hard); (3) and slash or eliminate government agencies that contribute little or nothing or actually are a drag on the country and the economy.”
“The Republicans propose major reforms of the corporate and individual income tax. The bill involves many half-measures, but, it is a giant step in the right direction and can lead to further steps in the future.
“I’ll speak to only one, seemingly innocuous part of the bill: the re-focusing of the corporate income tax on earnings in this country. With one of the highest corporate tax rates in the world, corporations with significant earnings overseas have an incentive to re-flag as foreign corporations. This occurs through corporate inversions (a U.S. corporation re-incorporating as a foreign corporation) or through merger and acquisition activity (a foreign corporation buys a U.S. corporation and reorganizes the overseas subsidiaries of the U.S. corporation as subsidiaries of the foreign corporation). Miller and Coors beer companies, and many other familiar brands as well, have been acquired by foreign companies in recent decades, in large part to avoid having to pay high taxes.
“As American subsidiaries of foreign corporations, their earnings in this country are subject to U.S. taxation, but not their overseas earnings. Instead, their overseas earnings are subject only to the much-lower corporate tax rates of other countries. If you think the people of this country are upset with the influence of foreign governments on Washington, DC, wait until they find out that foreign corporations own our beer!”
“While the only income tax regime that can be consistent with the principle of ‘equality before the law’ is a flat tax (all taxpayers pay an equal percentage), the perfect should not be the enemy of the good. The Tax Cuts and Job Act presented by the House Ways and Means Committee is an improvement on the status quo. It would benefit working Americans in at least three ways: (1) The government takes less out of most people’s paychecks; (2) entrepreneurs/employers are enabled to put more into most paychecks; and (3) many workers will no longer have to pay lawyers and accountants to make out their IRS forms. Moreover, the elimination of the ‘death tax’ is an elimination on perhaps the worst example of double taxation in the current code.”
“The Tax Cuts and Jobs Act would be a significant step forward in improving the U.S. tax code. Nearly every economist will attest to the benefits of lowering marginal tax rates and increasing the tax base. This bill would do just that. Many taxpayers would be able to simply use the increased standard deduction rather than maneuvering through myriad rules for deductions. Losing some of these deductions will be offset by the lowered rate and increased standard deduction. Reducing the corporate income tax rate will go a long way toward improving the international competitiveness of America’s corporations. The U.S. economy would greatly benefit from passage of this legislation.”
“A major disappointment in the Republican tax plan is the failure to apply inflation indexing to the basis of capital assets before calculating capital gains. We all know the ‘dollar’ is not a stable measure, historically, of values.
“The U.S. Treasury receives millions of dollars annually from the sale of appreciated assets, but the ‘appreciation of an asset in accounting terms’ is often fictional. This is theft by means of depreciating the currency.
“It is a shame no one in Congress seems to understand this legerdemain, and the U.S. Treasury opposes indexation because the confiscation of capital is a good revenue source.
“It was a good revenue source to import slaves, also.”
“It was a good idea to keep the highest marginal rate the same, because the long overdue corporate tax reduction ends up being a significant tax benefit to households in that bracket. Our nation’s highest-income earners own a very high percentage of corporate stock, and therefore the benefits to the corporations indirectly benefit our high-income earners already.”