I have long supported tax relief for families, small businesses, farms, and ranches in South Dakota. Tax relief accomplishes two important goals: it puts more money in the pockets of South Dakotans, and it expands the economy, which is why I have consistently supported legislation to make our tax code simpler and fairer and one that allows taxpayers to keep more of their hard-earned money. Our byzantine federal tax code tax is over 4 million words in length and imposes significant compliance burdens on families and small businesses. According to estimates by the Tax Foundation, the current tax law has grown into more than 70,000 pages of statutory provisions, regulations, and other interpretive guidance that forces taxpayers to spend nearly 9 billion hours and over $400 billion just to comply with the law each year. Congress hasn’t overhauled the tax code since 1986 and such reforms are long overdue.
In fact, comprehensive tax reform for businesses and individuals is one of the most important things we could do to stimulate economic growth. Harvard economist Dale Jorgenson has estimated that the last successful tax reform effort in 1986 grew the U.S. economy by more than $1 trillion and that a similar reform now could increase national wealth by $7 trillion over the long-term. With strong support in Congress and from President Trump, we have an opportunity to pass bipartisan and bicameral tax reform and make the tax code work better for all Americans.
I know that bipartisanship in this area is possible because in the 114th Congress, Sen. Ben Cardin (D-Md.) and I co-chaired a working group at the Senate Finance Committee that was dedicated to making recommendations to reform our outdated business tax system. Along with 12 other senators from both parties, we agreed on a number of important principles, like the need to lower business tax rates, address structural biases against investment in the tax code, promote American innovation, and simplify the tax code to improve the taxpayer experience. We also agreed on the need to move our tax system more toward taxing consumption rather than savings and investment. South Dakota is, of course, a great example of how to do this at the state level.
With the working group principles in mind, I have introduced a series of bills in the 115th Congress to help advance tax reform. These bills range from eliminating the financial burden posed by the death tax for small businesses, farms, and ranches in South Dakota and across the country to legislation that would update tax rules to make it easier and more efficient for S corporations to operate. In addition, my Investment in New Ventures and Economic Success Today Act of 2017 (S. 1144) – or INVEST Act, for short – is designed to accelerate business cost recovery, which along with lower tax rates, is the most effective tool in tax reform for sustainable economic growth for small companies, farms, ranches, and other pass-through businesses. I will continue to work with my colleagues in the Senate to enact comprehensive tax reform legislation that will provide a modern tax code that works for American businesses and families, not against them.
Tax reform holds enormous benefits to our economy, but it will only happen if there is a willingness in both political parties and presidential leadership to make tough decisions for the benefit of this and future generations. I intend to keep pushing for an overhaul of the tax code that will raise take-home pay by leaving more money in the pockets of hard-working Americans, generate more robust economic growth, help small businesses, farms and ranches, and entrepreneurs to succeed, and improve the competitiveness of our multinational companies in the ever-increasing global marketplace.
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|3/6/18||Thune: Tax Reform Is Working|