Last Tuesday, President Trump outlined his legislative priorities before a joint session of Congress. While pundits quickly jumped on the president’s departure from his off-the-cuff approach, I’m glad to see that his agenda has received a great deal of air time in the past few days.
Among the issues President Trump promised to address was our bloated, outdated tax code. His promise to reform the tax code garnered much deserved applause, but taxpayers and business owners have endured empty rhetoric long enough; rhetoric without meaningful action won’t grow the economy and create jobs. What we need is comprehensive tax reform, and we need it now.
Republicans have been laying the ground work to overhaul our tax code for several years. I would argue, this work led by Speaker Paul Ryan and House Ways and Means Chairman Kevin Brady, that it has a lot to do with why Republicans now control the White House and both chambers of Congress. This comes with a big responsibility: making good on their promise to pass tax reform.
A recent poll makes it abundantly clear that voters who put Republicans in charge have not forgotten about this commitment. Of those surveyed, three-quarters believe that “the issue of tax reform is very important.” Folks that were polled also believe the two “main worries or concerns about the current tax system” are the tax code overly complicated and tax rates are too high. As a small business owner, I can attest to both.
I am the proud owner of a Northern California business that has been in my family since the late 1980s. At Holt of California – a Caterpillar equipment dealer – we provide jobs for approximately 700 employees working to bring equipment solutions for the diverse needs of our customers.
Navigating the tax code has become increasingly challenging each year since the last major reform effort in 1986. A mishmash of small “fixes” and patches over the past 30 years have increased the word count (not to mention, complexity) of our tax code to over 4 million words. On top of the money and time it costs businesses like mine to comply, our hodgepodge of a code favors much larger companies that can afford the battalions of accountants and lawyers required to game the system. Taking control of our runaway tax code requires making it fair, efficient, and simple.
Fairness also means reducing rates for all businesses. You’d be hard pressed to find a business owner that wouldn’t like more capital to grow their operation – or a perspective employee looking for a reasonable wage. Lower tax bills for every business is the best way to accomplish this and jump start our flagging economy.
In addition, there are elements of the code, like the estate tax (death tax) that must be eliminated. Besides being cruel and unfair, the death tax jeopardizes small family-owned businesses and harms the economy. According to analysis by the Washington, DC based Tax Foundation, the death tax only accounts for approximately one half of one percent of federal revenue, and abolishing it would create over 150,000 American jobs. As far as common sense goes, repealing the death tax is at the top of the list.
For America to be globally competitive in the 21st century, we need to be unshackled from 1980’s tax policy. Comprehensive tax reform that simplifies the code, closes loopholes, sets fair business rates and eliminates counterproductive taxes like the death tax will make it easier to create jobs, raise wages, expand opportunity and grow the economy. Voters that put Republicans in the driver seat understand this. And rest assured, they will not settle for inaction or a half measure.
Ken Monroe is the president of Holt of California – a Caterpillar dealer in Northern California with approximately 700 employees.