It’s been more than 30 years since major tax reform. The time is ripe for Washington to do it again.
Leaders in Washington agree. “We are doing tax reform. It’s going to happen, because it has to happen,” said Speaker Paul Ryan (R-Wis.).
It has to happen, because if done right, tax reform will lead to faster economic growth, more jobs, and higher wages.
What’s more, faster economic growth will help solve other pressing problems, U.S. Chamber President and CEO Tom Donahue assured viewers of the Fox Business Network:
You can do things in tax reform that will fundamentally increase the size and growth of the economy. You can do things in tax reform that will put us in a position to deal with [entitlements] and health care and infrastructure.
Tax Principles
What should guide Congress and the Trump administration as they modernize our tax code?
Donahue noted these tax reform principles before the U.S. Chamber’s board of directors:
- Lowering tax rates for all businesses.
- Adopting an internationally competitive territorial system—no more taxing U.S. businesses twice, once abroad and once here, on their overseas earnings.
- Eliminate the bias against business investment in the depreciation system.
- Permanency, simplicity, and clarity.
- Ensuring the marketplace—not the government—picks the winners and losers.
“We’ve got a once-in-a-generation chance to do tax reform, and if we do it right, it can be the single most important step our leaders take to drive economic growth,” said Donohue. “But the process of overhauling our tax code is as complicated and controversial as the tax code itself—which is why it hasn’t happened since 1986. As the debate unfolds, we’re going to urge lawmakers to ensure that reform is designed to maximize growth.”
The U.S. Chamber played a critical role in passing tax reform in 1986, and again it will be at the center of the conversation as it works closely with Congress and the Treasury Department on technical aspects of tax reform as well as transition rules.
Donohue also stressed the important role the business community will play: “Business is going to have a seat at the table. Because if we don’t—guess what? We’re on the menu.”
Businesses of all sizes and shape will have a major burned lifted off them with pro-growth tax reform. As Caroline Harris, vice president, tax policy, and chief tax policy counsel at the U.S. Chamber explained last year, it “will let businesses focus on what they do best, driving economic growth and creating jobs.”
About the authors
Sean Hackbarth
Sean writes about public policies affecting businesses including energy, health care, and regulations. When not battling those making it harder for free enterprise to succeed, he raves about all things Wisconsin (his home state) and religiously follows the Green Bay Packers.
