Have you met anyone who thinks the current federal tax code is simple or fair enough? As your congressman, I haven’t either.
Clocking in at more than 70,000 pages, the current federal code is packed with confusing provisions and loopholes that tend to favor special interest groups and those lucky few “in the know.”
The maze-like complexity of our current tax code renders it all but impenetrable to American families and business owners who do not have the resources to hire a specialist to decode it for them. The status quo is simply unfair.
Reform is long past due. It has been over 30 years since we have enacted major tax reform, and we now have the opportunity to clear the cobwebs and dust off provisions to reduce the burden on taxpayers while spurring economic growth.
I have listened to many stories from constituents across Central Washington about how the current tax code negatively affects families and businesses. Filing returns should not require hours of time and stress just to ensure that Uncle Sam is not taking an unfair chunk of your paycheck. Small businesses that are striving to expand and succeed should no longer be penalized with unfair rates.
Family-owned farms and businesses should no longer be taxed twice, or even three times, after the passing of a loved one by an onerous death tax. No American should worry about whether a neighbor is paying less in taxes simply because they hired a better accountant.
We need a tax code that is both fair and simple. This week, the House of Representatives is considering the Tax Cuts and Jobs Act, which is our plan for historic tax reform. While I believe this plan will benefit the whole country, it is important to understand how it will affect families in Central Washington.
First, this plan is pro-taxpayer. The tax brackets are simplified and reduced for low- and middle-income Americans, allowing more people to keep more wages, while maintaining the 39.6 percent bracket for top earners.
According to the Internal Revenue Service, over 80 percent of taxpayers in Washington’s Fourth Congressional District claim the standard deduction when filing taxes. With our reform in place, the standard deduction will double — from $6,350 to $12,000 for individuals and from $12,700 to $24,000 for married couples. This means families in Central Washington would see an immediate benefit.
Our plan is pro-family. It increases the Child Tax Credit from $1,000 to $1,600 per child and includes a tax credit for non-child dependents, such as elderly or disabled adults. Expanding support for families allows you to keep up with the costs to take care of your loved ones. I am also pleased that our plan maintains the Adoption Tax Credit, which makes adoption a more affordable choice.
This plan is pro-growth. The bill aims to benefit small businesses by lowering the maximum tax rate and distinguishing between individual wages and business income.
Our plan allows small businesses to write off loan interest and the cost of new equipment in order to expand and provide more jobs and higher paychecks for employees. Our plan will also incentivize American corporations and businesses to invest in the U.S. to spur economic development and increase wages in communities here at home.
In fact, the Tax Foundation has estimated that over the next 10 years, more than 20,000 jobs would be created in Washington state, with an average wage increase of over $3,000.
Simplifying our tax code to make it fairer is a priority of mine for Central Washington. I encourage you to read and learn more about the bill at www.fairandsimple.gop.
As the act moves through regular order in Congress, I am keeping a close eye on any amendments adopted to examine their impact on the Fourth Congressional District.
Dan Newhouse of Sunnyside represents Washington’s Fourth Congressional District.