Congress must pass comprehensive tax reform. The tax system is broken, penalizing savings and investments, overburdening businesses, and making it hard for lower- and middle-income Americans to get ahead. The government has not undertaken comprehensive tax reform since the Reagan administration, and it’s obvious that reform is sorely needed.
Under President Trump, the economy has seen unprecedented gains — a soaring stock market, an unemployment rate at its lowest level in over 15 years, and both business and consumer confidence levels at all-time highs. There is a clear path forward for our nation to continue to enjoy this remarkable prosperity, and to ensure that our economy continues to expand, allowing a larger portion of the American people to participate in this economic boom.
That clear path forward is through tax reform. Trump has laid out a bold vision of reform that provides relief to lower- and middle-income Americans, helps working families reduce the burden of child care expenses, and allows hardworking Americans to keep more of the money they earn. He has proposed doubling the standard deduction, simplifying the tax code, and reducing the rate of taxation for the vast majority of Americans — including dramatically expanding the number of households that will no longer have to pay any income tax. These are common sense — and frankly, long overdue — solutions that will help every American by making our tax system less cumbersome and easier to navigate, and by putting money back into the pockets of those who earn it.
As a business owner myself, I understand all too well the stresses placed on companies by the tax system. At a rate of 35 percent, the U.S. has the highest corporate tax rate in the developed world. As a result, many businesses choose to relocate overseas, taking their jobs and capital with them, or they simply outsource work that becomes more affordable abroad. The idea that the more we tax big corporations, the greater the burden those companies bear is a complete misconception. The burden of high corporate tax rates is borne by consumers and workers in the form of higher prices for consumer goods, and lower wages with less generous benefits for company employees. Creating a more business-friendly environment and providing tax relief to companies will increase their incentives to keep jobs in the U.S., and lead to higher wages and job growth.
To accomplish this, the White House has proposed several crucial reforms to reduce the crushing impact our system of taxation has on businesses in this country. First, Trump has proposed capping the corporate tax rate at no more than 20 percent. This will give companies an economic incentive to keep their doors open in the U.S. rather than off-shoring work that could produce jobs at home.
Second, incentives will finally be aligned for businesses to be able to invest in a way that makes sense. This tax plan allows companies to deduct the full costs of their capital investments for at least five years, which will go a long way in industries such as manufacturing, and helping to bring manufacturing jobs back home. Finally, this plan eliminates special interest tax breaks for big companies, while leveling the playing field for small businesses and the American worker.
Congress must act. It’s time for Democrats to stop rejecting common sense legislation simply because Trump has proposed it. This tax reform bill is a win for the economy, a win for businesses, and mostly importantly, a win for the American people.
Lena Epstein is a Republican candidate for Michigan’s 11th congressional district and co-owner of Vesco Oil Corporation.