State legislators across the country are urging Congress to make the 2017 Republican tax cuts permanent.
The Tax Cuts and Jobs Act (TCJA) created pro-growth tax cuts that are currently allowing millions of individual taxpayers, families, and small businesses across the country to keep more of their hard-earned money. Under current law, most tax provisions in TCJA are set to expire at the end of 2025, meaning most Americans would see an effective tax increase.
The TCJA reduced personal income tax rates, nearly doubled the standard deduction, and reduced the Alternative Minimum Tax (AMT). This has resulted in a net tax cut of over one trillion five hundred billion dollars ($1,500,000,000,000), with the average family receiving a tax cut of more than one thousand five hundred dollars ($1,500).
Unfortunately, these are among the 23 provisions that will soon expire. In hopes of preventing this outcome, state legislators are now doing everything they can to encourage Congress to make these provisions permanent.
Arkansas Representative David Ray introduced HCR 1001, ‘To Urge Congress to Permanently Extend the Tax Cuts and Jobs Act of 2017’. The resolution was quickly approved by both the House and Senate.
In addition to urging Congress to make these provisions permanent, Ray’s HCR 1001 highlights the benefits of the corporate income tax cut as well. The resolution explains:
“WHEREAS, prior to the 2017 tax cuts, the top corporate income tax rate in the United States was thirty-five percent (35%), the highest among all nations in the Organization for Economic Co-operation and Development (OECD); and
WHEREAS, the 2017 tax cuts reduced the business tax rate from thirty- five percent (35%) to twenty-one percent (21%), bringing the United States back to average among OECD member nations, and dramatically enhancing American competitiveness;”
As much of 70 percent of the corporate tax burden is born by employees in the form of lower wages and consumers in the form of higher prices. It has been well document that the corporate rate reduction included in the TCJA was passed onto households across the country through pay raises, bonuses, and lower monthly bills.
Missouri Representative Phil Christofanelli has introduced a similar resolution, HCR 17, and it is anticipated that other states will follow suit.
Allowing these provisions to expire would inflict a great deal of financial harm on households across the country at a time when they can least afford it. Fortunately, state lawmakers are doing everything in their power to prevent this from happening.