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President Joe Biden came into office promising to repeal President Trump’s 2017 Tax Cuts and Jobs Act – a law that turbocharged American job growth and U.S. national competitiveness. In the first two years of the Biden administration, there was a chance that the president could have succeeded in undermining the law.
Yet, today, as Biden finishes his term, the Trump tax cuts are yet again under threat. Moderate Senate Republicans are refusing to vote on a tax deal that would keep the Trump tax cuts in place for small businesses and American working families. Failing to pass this tax deal would hurt our economy amid crushing inflation, and it would undermine American competitiveness with China. We shouldn’t let politics hold up this deal. The American people are waiting for tax relief.
In January, the House overwhelmingly passed the Tax Relief for American Families and Workers Act (H.R. 7024), a major new tax relief package that builds on the successes of the 2017 Tax Cuts and Jobs Act. Its relief targets the engines of American productivity, including full deductibility for Research and Development costs, full and immediate expensing, as well as interest deductibility and restoration of deductibility of depreciation and amortization costs.
Passing this bill enhances American competitiveness with China, boosts job creation, increases wages for workers, and promotes new investment and innovation.
Senate Republican leadership needs to support a deal that would help extend the tax cuts before the election in November. Unless they allow a vote, the Senate could raise taxes on American businesses.
But it also does something else: The bill extends important cost recovery provisions of the 2017 Republican tax cuts signed by President Trump, an essential step in achieving full permanency of the Tax Cuts and Jobs Act.
Without congressional action, President Trump’s 2017 tax cuts expire at the end of 2025.
While Senate Finance Committee Ranking Member Mike Crapo and some colleagues have raised objections about provisions of the bill that would expand the Child Tax Credit, Crapo and other GOP senators need to keep sight of the significance of this measure in a larger fight.
Passing the Tax Relief for American Families and Workers Act would vastly improve Republicans’ bargaining position going into the fight over the future of the Trump tax cuts.
And right now, advocates for job growth and competitiveness must be prepared for this fight.
At a March 12 hearing on the Tax Relief for American Families and Workers Act, Senate Finance Committee Chair Ron Wyden (D-OR) declared, “This set of policies isn’t going to be on the table in 2025 if this bill stalls out.” It’s understandable for Republicans to dismiss this as empty talk, given that the GOP faces a highly favorable Senate map in this year’s elections.
But, in politics, nothing is certain. Remember the “red wave” that wasn’t? Even if Republicans retake the Senate, Wyden and allies could follow through on their threat if Democrats retain the White House or take back the House. President Biden has already declared that if he is re-elected, he will not renew the 2017 tax cuts.
Conservative Republicans have every reason to support the Tax Relief for American Families and Workers Act. The bill would be financed by repealing the employee retention tax credit, a COVID-era program that has been rife with fraud. Over 40 conservative and free-market organizations have urged lawmakers to pass the pro-growth legislation. Other organizations and leaders from across the conservative movement have strongly backed the bill. At the same time, far-left Democrats including Sen. Elizabeth Warren (D-MA) and Rep. Rosa DeLauro (D-CT) have railed against the legislation.
If GOP senators want to save their signature economic success of the past decade, they must get to yes on this tax reform. Time is running out for the Senate to do the right thing for American families and workers.
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