McCaul, Buchanan, Colleagues Introduce Legislation to Make Republican Tax Cuts Permanent

Congressman Michael McCaul (R-Texas) announced he has joined Congressman Vern Buchanan (R-Fla.) and 71 colleagues in reintroducing the TCJA Permanency Act (H.R.976), legislation to make permanent the tax cuts for individuals and small businesses originally enacted as part of the Tax Cuts and Jobs Act (TCJA) of 2017.

Without Congressional action, 23 different provisions of the 2017 Republican tax law are set to expire after 2025.

“Republicans’ Tax Cuts and Jobs Act radically transformed the economy, bringing wages that far outpaced inflation, record lows in unemployment, and tax decreases that left more money in people’s wallets,” said Rep. McCaul. “As Americans today struggle to make ends meet in President Biden’s economy, I’m proud to join this effort to provide permanent relief, ensuring families and small businesses will always have a chance to prosper.”

“In 2017, Republicans delivered the most comprehensive overhaul of the U.S. tax code in more than three decades and achieved historic economic growth,” said Rep. Buchanan, the most senior Republican and Vice Chair of the Ways and Means Committee. “With Americans continuing to suffer under the weight of record-high inflation and an uncertain economic future, we need to provide some much-needed relief and certainty to hardworking families and Main Street businesses and ensure these tax cuts do not expire.”

Background:

According to the Tax Foundation, “most taxpayers will see a tax hike unless some or all provisions are extended.” In fact, according to its initial estimates, a single mother of two earning $52,000 would face a $1,500 tax hike in 2026. For a married couple with two children and $85,000 in income, the additional tax bill would be over $1,700 per year.

Key Provisions of the TCJA Permanency Act:

1. Permanently lowers tax rates for individuals and families, allowing Americans at every income level to keep more of their hard-earned money;
2. Preserves the 20 percent deduction for small businesses, ensuring taxes won’t go up on Main Street businesses, which employ nearly half of the U.S. workforce;
3. Maintains the higher standard deduction, increasing the amount of tax-free income a middle-class family can earn;
4. Locks in the doubled child tax credit, further encouraging workforce participation; and
5. Permanently simplifies the tax filing process, allowing 9 out of 10 Americans to get the full benefit of tax deductions without the headache of tracking receipts or itemizing.

The TCJA reduced taxes on middle-class families and small businesses across the country and created nearly 5 million jobs in the two years following its passage. It also delivered the lowest unemployment rate in 50 years (3.5 percent), all-time low unemployment for African American and Hispanic workers and the fastest wage growth in a decade.

The nonpartisan Congressional Budget Office also found the TCJA reduced federal tax rates for families across every income level while actually increasing the share of taxes paid by the top 1 percent of American households.

The TCJA Permanency Act has received the support of Americans for Tax Reform, America First Policy Institute, the National Federation of Independent Businesses, Heritage Action, the National Association of Manufacturers, the S-Corp Association, the National Taxpayers Union (NTU), Americans for Prosperity, and the American Farm Bureau Federation.