Proponents of the reconciliation bill argue that much of their proposed tax increases are just reversing the tax cuts “for the rich and for corporations” enacted in 2017, and ensuring that the wealthy and business pay their fair share.
But the facts don’t support either assertion. The federal government just ended its fiscal year. How do revenues this year compare to the year before enactment of the Tax Cuts and Jobs Act (TCJA):
- Taxes paid by corporations are $73 billion or 25% higher today than they were in 2017
- Taxes paid by individuals are $465 billion or 29% higher today than they were in 2017
And let’s remember 80% of income tax revenue comes from the top 10% of earners.
These high receipts show that when the government incentivizes companies to grow here in America jobs increase and personal wealth grows. The last thing we want to do right now in the midst of our fragile economic recovery is reverse that trend. The multi-trillion-dollar tax reconciliation plan that is currently being debated by Congress would raise the corporate tax rate to 26.5% – higher than China’s and one of the worst rates in the world. And it would drive American jobs, manufacturing, research and IP overseas, reversing the gains we’ve seen from the TCJA. After the TCJA, $1.5 trillion of U.S. profits flowed back into America, we saw the highest number of manufacturing hires since 2007, and America recaptured the title of the world’s most competitive economy.
Under the $3.5 trillion reconciliation bill, it is better to be a foreign company or foreign worker than it is to be an American company or American worker. This proposal will take our country back to the dark days when American companies operated at a disadvantage. Rolling back job-creating tax reforms will slam the brakes on hiring and wage increases, and government checks and higher taxes won’t do as much for working families as good paying jobs and rising pay checks.
We must not surrender jobs, growth, or tax revenues to other countries in order to advance a multi-trillion partisan agenda at home. The reconciliation bill is 100 bills in one and will reverse the meaningful gains from the Tax Cuts and Jobs Act. It needs to be stopped.