Making Historic Tax Reform Permanent
September 28, 2018
The Tax Cuts and Jobs Act, which I was proud to vote for last year, has helped turbocharge our economy from the many years of slow growth that we saw under President Obama.
Since President Trump signed tax reform into law last December, more than 430 companies have announced pay raises, bonuses or 401(k) hikes, benefiting more than 4 million Americans. In total, 1.7 million new jobs have been created, while the average Texas family has saved more than $2,000 thanks to tax reform.
This is great progress, but I believe we can and should do more. That’s why I am pleased that this week, the Republican controlled House passed what President Trump has dubbed, “Tax Reform 2.0.” Authored by my friend and fellow Texan, Kevin Brady, Tax Reform 2.0 is about locking in tax cuts for middle-class families and small businesses, and changing the culture in Washington so that we continuously improve our tax code and never again let America fall behind our global competitors.
Let me explain why this is necessary and what Tax Reform 2.0 will mean for you and your family. Tax Reform 2.0 focuses on three main areas:
- Making permanent the tax cuts for middle-class families and small businesses that are already having great benefits for Americans.
- Helping families and individuals save for their future now that they are seeing their paychecks increase and are keeping more of their hard-earned money.
- Spurring American innovation.
The first bill of Tax Reform 2.0 will make permanent the individual and small business tax cuts, ensuring that families keep more of their hard-earned paychecks and giving local companies the certainty they need to invest in their workers and grow their business. The nonpartisan Tax Foundation has estimated that an additional 1.5 million jobs will be created, wages will continue to grow, and our GDP will increase by 2.2 percent if Tax Reform 2.0 becomes law.
The second part of Tax Reform 2.0 will help families save earlier in life and more over time for retirement and education. It would create a new Universal Savings Account (USA) that offers a fully flexible savings tool that families can use any time that’s right for them. This legislation would also expand 529 educational accounts by providing families with the flexibility to also use their education savings to pay for apprenticeship fees to learn a trade, cover the cost of home schooling, and help pay off student debt. It would also allow small businesses to join together to provide retirement plans to their workers.
Finally, Tax Reform 2.0 will spur innovation by allowing new businesses to deduct up to $20,000 in initial start-up costs, helping them move from the kitchen table to Main Street. As a former small business owner, I know how critical this provision will be to help spur new business and job growth.
We finally have an economy that is moving in the direction that our workers deserve. Under our reformed tax system, we’re seeing incredible job growth, bigger paychecks, and a tax code that works on behalf of families and American businesses.
By sending Tax Reform 2.0 to the Senate next week, we are making sure America’s middle-class families and our small businesses keep more of what they earn, helping families and workers save more for their future, spurring more new business start-ups here in America.
Member of Congress