WASHINGTON — An overhaul of the U.S. tax code that leads to an increase in wages and helps corporations to create jobs would be welcomed by many constituents, because, after all, “Americans are delightful people,” said Rep. Peter Roskam, a key voice on tax reform.
The GOP leadership’s tax package calls for cutting rates for businesses and certain taxpayers, and cracking down on deductions. The corporate rate, which averages around 35%, would decrease to about 20%. It is unclear if the legislation would include infrastructure funding policy.
If enacted, the change to the tax code would mark the most significant update of tax policy in more than 30 years. It also could restore confidence in federal institutions, such as Congress, Roskam, an Illinois Republican and chairman of the Tax Policy Subcommittee, said Oct. 11 during a panel discussion at the Newseum.
“Congress is not well-perceived right now. And the ability for Congress to come forward and do something significant that has an impact on the daily lives of our constituents is something that people are really interested in,” he said. “So, said another way, members of Congress are ready to go home and hear people say, ‘good job,’ ‘well done.’ And they’ve not heard that in a long time.”
Ways and Means Chairman Kevin Brady (R-Texas) and Senate Majority Leader Mitch McConnell (R-Ky.) stressed a commitment to take up the legislation this fall. The two belong to the “Big Six” group of negotiators on tax reform that includes House Speaker Paul Ryan (R-Wis.), Senate Finance Chairman Orrin Hatch (R-Utah),Treasury Secretary Steven Mnuchin and National Economic Council Director Gary Cohn. Prior to serving in their roles in government, Mnuchin and Cohn were top executives at Goldman Sachs.
President Donald Trump, who has turned to Wall Street executives for guidance on monetary policy, is a staunch champion of reforming the tax code. He has called for a corporate rate of 15%, which he said could lead to employment growth and entice corporations to transfer profits they keep in overseas accounts back to the United States. Trillions of dollars in corporate profits are estimated to be stored overseas, he added.
If the legislation reaches his desk, the president has pledged to sign it into law.