By Kenny Marchant
President Ronald Reagan once said, “If all of this seems like a great deal of trouble, think what’s at stake.”
My colleagues and I on the House Ways and Means Committee are working on an issue that touches every American, and the stakes are high. Tax reform can unleash a wave of economic growth in this country not seen in a generation.
It’s been over 30 years since comprehensive tax reform received a presidential signature – President Reagan in 1986. The United States tax code is too long, too complicated and full of loopholes. It has thousands of pages rewarding Washington special interests and high-priced lobbyists. We need a smaller, simpler tax code for American families.
This year, nine out of 10 people used software or a tax professional to file their taxes. The reforms I’m working on in the Ways and Means Committee will allow nine out of 10 people to file their taxes on a standard post card. Simple for families, fair and competitive for business, and an IRS that’s accountable to the people – that’s comprehensive reform for the 21st Century.
American businesses are at a disadvantage in this global economy. Our current tax code rewards growth overseas instead of expansion at home. The United States has the highest business tax rate in the developed world – a whopping 35 percent. More than double the business rate in Canada (15 percent) or five points higher than Mexico (30 percent).
By cutting the tax rates of America’s job creators our plan removes the current incentives to ship jobs overseas. That means more jobs in our communities. The Committee’s plan improves competitiveness for American companies on the global stage. Two ways to do that are by lowering business tax rates and allowing capital investments, like machinery or business tools, to be fully deductible. Our tax code should incentivize businesses to create American jobs, produce American products and increase American prosperity.
With these commonsense reforms for individuals and businesses, the third piece is the IRS. You can’t have comprehensive reform without reforming the tax collector. The IRS is a bloated, unaccountable government agency filled with waste, fraud, and abuse.
The Committee’s reform starts at the top. Earlier this month, I joined 14 of my colleagues on the House Ways and Means Committee in calling on President Trump to remove IRS Commissioner John Koskinen. Mr. Koskinen’s legacy at the IRS is one of corruption, incompetence and a betrayal of the public trust. The job of an IRS administrator is two-fold: to serve hardworking Americans in a non-partisan way, and to blindly administer the tax code in the same manner for every taxpayer. The days of senior officials at the IRS targeting nonprofit organizations because of ideology are over.
We need to dismantle the broken system of tax collection and remind IRS staff that the “S” stands for service. The IRS as we know it will be gone. Our plan reduces it to just three service units: families and individuals service unit, business service unit and small claims court service unit. Texans know how to spend their money better than Washington does – the government needs to give it back to the taxpayers who earned it. I want to make it easier for entrepreneurs to reinvest in their companies, create more jobs and turn small businesses into the businesses of the future.
The Texas recipe for economic prosperity is limited government and lower taxes. Year-over-year we’ve outperformed the United States in economic growth. The true tax reform America needs looks a little more like Texas and a lot less like Washington.
Congressman Kenny Marchant represents Texas’ 24th Congressional District in the U.S. House of Representatives. He sits on the House Committee on Ways and Means.