U.S. Sen. John Thune (R-S.D.), a member of the tax-writing Senate Finance Committee and a key voice during the tax reform debate, this week discussed how despite being the law for less than one month, the Tax Cuts and Jobs Act has already had a noticeable effect. Businesses throughout the United States have announced special bonuses, wage hikes, and other benefit increases. Thune also noted that numerous companies are acting to keep jobs here in the United States and create new ones, too, citing the recent announcement by Molded Fiber Glass, based in Aberdeen, South Dakota, that it will stay open longer than expected, as an example.
Thune’s remarks (as prepared for delivery)
“Mr. President, tax reform has been the law of the land for less than a month, but it’s already fostering a new era of economic optimism – and American workers are seeing the benefits.
“For years, American businesses large and small were weighed down by high tax rates and growth-killing provisions of the tax code.
“Plus, our outdated international tax rules left America’s global businesses at a competitive disadvantage in the global economy.
“The Tax Cuts and Jobs Act changed all that.
“We lowered tax rates across the board for owners of small and medium-sized businesses, farms, and ranches.
“We expanded business owners’ ability to recover investments they make in their businesses, which will free up cash that they can reinvest in their operations and their workers.
“We lowered our nation’s massive corporate tax rate, which up until January 1 was the highest corporate tax rate in the developed world.
“And we brought the U.S. international tax system into the 21st century by replacing our outdated “worldwide” system with a territorial tax system, so that American businesses are not operating at a disadvantage next to their foreign competitors.
“Mr. President, despite the fact that the new law has been in place for less than a month, it’s already having a noticeable effect.
“Businesses are seeing a future defined by growth and success.
“And they’re already passing some of the expected benefits on to their workers.
“Business after business has announced special bonuses, wage hikes, or benefit increases.
“Bank of America.
“And the list goes on.
“In addition to giving out bonuses to eligible employees, Walmart is raising its starting wage for hourly employees, expanding maternity and parental leave benefits, and creating a new adoption benefit for employees.
“More than 1 million Walmart employees will benefit from the changes.
“Aflac is boosting retirement benefits for its workers by increasing the size of its 401(k) match from 50 to 100 percent on the first 4 percent of employees’ contributions.
“It’s also announced a one-time $500 contribution to the retirement account of every employee.
“PNC is giving a $1,000 bonus to 90 percent of its employees and adding $1,500 to employees’ pension accounts.
“It’s also boosting its minimum pay.
“Similarly, Great Western Bank, which is headquartered in my state of South Dakota, is raising its minimum wage to $15 and providing a $500 bonus or wage increase for nearly 70 percent of its workforce.
“The bank is also enhancing its employee health care program and doubling its annual contribution to its Making Life Great Grants community reinvestment program.
“I could go on.
“But the good news is not limited to increased wages, bonuses, or benefits.
“Companies are also acting to keep jobs and create new ones.
“Fiat Chrysler just announced that it will be adding 2,500 jobs at a Michigan factory to produce pickups that it has been making in Mexico.
“In October, CVS Health announced that it would create 3,000 new jobs if the corporate tax rate was reduced.
“And in my own backyard, Molded Fiber Glass is keeping its doors open longer than expected, which is good news for its employees and the entire community in Aberdeen, South Dakota.
“Then there are the utility companies.
“Utilities around the country are benefiting from tax reform, and more than one is looking to pass on savings to consumers.
“Bloomberg reports that, and I quote, ‘Exelon Corp., the biggest U.S. utility owner by sales, is already offering to reduce bills.’
“In Illinois, ComEd is requesting permission to, and I quote, ‘pass along approximately $200 million in tax savings to its customers in 2018.’
“And in Washington, D.C., Pepco has announced plans to pass on tax savings to customers beginning in the first quarter of this year.
“Mr. President, all of these benefits are going to make a real difference in families’ lives this year – and in some cases, well into the future.
“And the main benefits of tax reform are still to come.
“The IRS just released the new withholding tables for the tax law, and Americans should start seeing the results in February.
“Thanks to lower income tax rates, the doubling of the standard deduction, and the doubling of the child tax credit, 90 percent of American workers – 90 percent – should see bigger paychecks starting next month.
“And that’s just the beginning.
“One major goal of tax reform was to provide immediate, direct relief to hardworking Americans, and that’s happening right now.
“But our other goal was to create the kind of robust, long-term economic growth that would provide long-term security for American families.
“That’s already starting with the wave of bonuses and wage increases, but there’s a lot more to come.
“As businesses large and small experience the benefits of tax reform, American workers will see increased access to the kinds of jobs, wages, and opportunities that will secure their American dream for the long term.
“It’s a good day in America, Mr. President.“And it’s going to get even better.”
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