On Thursday, 9 GOP senators who serve in the Senate Finance Committee issued an open letter to President Trump to express their support for his desire to block the expiring provisions of the Tax Cuts and Jobs Act (TCJA) and their determination not to “support a tax package that only provides temporary relief from tax hikes.”
If the provisions are allowed to expire, marginal rates will return to their permanent TCJA levels of 10%, 15%, 25%, 28%, 33%, 35%, and 39.6%. The TCJA reduced those to 10%, 12%, 22%, 24%, 32%, 35%, and 37%. Under the TCJA, basic standard deduction amounts were nearly doubled. They were adjusted annually for inflation after 2018. The TCJA essentially suspended the personal exemption.
“You were elected with a mandate to do big things,” the letter began. “One of those big things is to provide lasting tax relief for small businesses and families across the country. As members of the Senate Finance Committee, we write to express our support for your position that the expiring provisions of the Tax Cuts and Jobs Act must be permanent and not sunset. After passage of your tax cuts in 2017, we had a booming economy with soaring investment, higher wages, increased productivity, and zero corporate inversions. Without action, at the end of this year, taxes will increase for Americans in every income group and nearly six million jobs are at risk.”
“A temporary extension of these pro-growth and pro-families policies is a missed opportunity,” they declared. “Businesses need certainty while investing in their companies and taxpayers should not fear tax hikes due to Congressional inaction. Congressional Republicans have an historic opportunity to enact this lasting tax relief. Failing to act boldly does a disservice to the American people who entrusted us to deliver in November. Thus, we will not support a tax package that only provides temporary relief from tax hikes.”
“If lawmakers fail to extend these provisions, 62% of filers would see a tax increase,” Faith Jablokow of the Taxpayers Protection Alliance stated. “Additionally, the TCJA fostered a 4.7% increase in corporate investment, a significant achievement. This is due to the TCJA lowering the corporate income tax rate from 35% to 21%. This had the dual effect of making American corporations more competitive globally and allowing them more liquid assets to invest back into the economy.”
GOP Senators Steve Daines (MT), Senate Majority Leader John Thune (SD), Mike Crapo (ID), John Barrasso (WY), James Lankford (OK), Ron Johnson (WI), Roger Marshall (KS), Marsha Blackburn (TN), and Thom Tillis (N.C.) signed the letter.
