We Cannot Afford to Wait on Tax Reform

May 19, 2017 Issues: Taxes

Nebraskans have been waiting far too long for a simpler, fairer tax code. To help them plan for the future for their families, farms, and businesses, we need to move forward on comprehensive, pro-growth tax reform.

Over the past several years, we have extensively reviewed our country’s tax policies, looking for ways to simplify compliance and lower rates by broadening the base. Since 2011, we have held more than 40 tax reform hearings on the Ways and Means Committee.

Now is the time to finally complete this necessary work. This week, we held a full committee hearing to discuss the details of our tax reform plan and stress the importance of getting this done.

We know our broken tax code is killing opportunity. Dollars which could be used by job creators to hire more workers, increase wages, and reinvest in the economy are instead flowing to the Internal Revenue Service and tax preparers. Because the tax code is so complicated and riddled with loopholes, 90 percent of taxpayers have to hire outside professionals or use computer software to help them file.

The way we tax businesses in the U.S. makes us uncompetitive with the rest of the world. Along with having one of the highest corporate tax rates among major economies, we are also the only one which taxes profits on a worldwide basis. These conditions put U.S. exporters at a competitive disadvantage.  

In Nebraska, this hurts everyone from the agriculture producers helping feed the world to the manufacturers developing the equipment to help people in other countries feed themselves.

Additionally, I hear almost daily from producers and small businesses in my district about the need to eliminate the Death Tax and provide them the certainty they need to ensure they can keep their operations going, creating jobs and economic opportunity for their families and their neighbors for generations to come.

These families are not awash in cash and liquidity. Their assets are held in the land and equipment they use to make and grow, and for them the question often comes down to what assets to sell or whether they can afford to borrow to pay this tax. How they decide to handle this decision can have a very real impact on the productivity of their businesses going forward.

Our plan for pro-growth tax reform will benefit Americans at all income levels. With lower rates across the board, the Tax Foundation estimates each family would keep $4,900 more in earnings each year. By doubling the standard deduction, more than 90 percent of Americans could take it and dramatically simplify the filing process.  

The plan also increases how much new businesses can immediately deduct, from equipment to machinery to buildings, so they can keep more of their startup cash and grow their operations. Additionally, it eliminates the Death Tax once and for all to protect family farms, ranches, and small businesses.

Rather than making piecemeal changes to our tax code, we need permanent reforms individuals, families, and businesses can depend on. By providing this certainty, we have the potential to drive double the economic growth we would see through short-term tax cuts.

We cannot afford to wait any longer to fix our tax code. This is the time to finally lift the burden, reclaim our country’s leadership in the global economy, and unleash greater opportunity to improve the lives of all Americans.