Tax Reform: Unleash Innovation and Economic Growth

Tax Reform: Unleash Innovation and Economic Growth

This piece was originally published in the September 2017 issue of electroindustry.

Congressman Kevin Brady (R-TX)

Congressman Kevin Brady represents the Eighth District of Texas and chairs the House Ways and Means Committee.

As chairman of the House Ways and Means Committee, the chief tax-writing committee in Congress, I’m focused on working with my colleagues in Congress and President Trump to deliver comprehensive tax reform this year. We know that American families, workers, and job creators are eager for a simpler, fairer tax code that is built for innovation and economic growth.

I recently joined with other leaders from the House, Senate, and Trump Administration to release a statement defining our shared principles. It states, in part, “We are all united in the belief that the single most important action we can take to grow our economy and help the middle class get ahead is to fix our broken tax code for families, small business, and American job creators competing at home and around the globe.”

Throughout the last month—and the Ways and Means Committee’s work on tax reform over the past several years—we heard from many Americans that successful tax reform must contain several key elements.

First, it must be bold. If we want to re-establish America as a global magnet for research and development, job creation, investment, and innovation, we cannot settle for temporary cuts or timid solutions. Loopholes must be closed for special interests, and tax rates must be lowered for American job creators of all sizes—corporations as well as pass-through businesses. No longer can we allow our companies to bear the burden of the modern world’s highest corporate tax rate. At the same time, Main Street small businesses should not be forced to accept an unfair system where their business income is taxed at individual rates as high as 44.6 percent.

We’re dedicated to bringing rates down as low as possible for all American businesses. But lower rates alone will not unshackle the growth of jobs, paychecks, and the economy. We must move the United States to a modern, “territorial” international tax system that does not discourage multinational businesses from bringing home foreign profits to invest in communities here. We should also provide American innovators with unprecedented capital expensing, offering larger write-offs for businesses when they purchase the equipment, machinery, software, or buildings needed to produce and compete at a higher level.

For tax reform to have a lasting positive impact, businesses and families need certainty to plan and invest for the long term. That’s why tax reform must be permanent. It is essential that our bold solutions do not expire five or 10 years down the road.

Finally, it is critical that tax reform happen now—in 2017—when we have this rare opportunity. Families and businesses are eager for a fairer, simpler tax code that rewards hard work and encourages economic growth. Delays will only induce greater uncertainty, and only prolong the harmful impacts of today’s broken system.

In June, the Ways and Means Committee welcomed David Farr, CEO of NEMA Member company Emerson Electric, to testify on tax reform. Mr. Farr made clear the real costs of inaction. “The cost of delay means a lack of innovation, less new products, and less jobs,” he said. “It is that simple.”

For the first time in 31 years, we have a President, a House, and a Senate who are dedicated to making pro-growth tax reform a reality. But we cannot do this alone. We need active participation from the nation’s manufacturing companies and workers. Your feedback and support is essential to helping us go bold and get the details right.

This is our opportunity to deliver a 21st-century tax system that unleashes American innovation and economic growth. Working together, I am confident we can get it done.

One thought on “Tax Reform: Unleash Innovation and Economic Growth

  1. Tax reform has been on the table since Reagan’s tax reform 40 years ago. You imply that others have stood in the way. There are smart taxes and counter productive taxes but someone has to pay a tax.
    PS. Since Houston has been hit with an inevitable storm, the rest of the nation is expected to buck up 150 billion to rebuild. The 150 Billion is a tax on bad judgment.

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