After passing historic tax reform last December, the U.S. House approved additional measures this week to advance savings for American taxpayers. U.S. Rep. Harold "Hal" Rogers (KY-05) voted for Tax Reform 2.0 legislation to complement the Tax Cuts and Jobs Act of 2017, including the Family Savings Act (H.R. 6757), the American Innovation Act (H.R. 6756) and the Protecting Family and Small Business Tax Cuts Act of 2018 (H.R. 6760). Permanent tax relief for families means millionaires pay a larger share of the tax burden and those who need it most see the largest percentage drop in their taxes.
"One-third of American workers don't have a retirement plan through their employer, but this plan will help change the course for the future. Tax reform is one of the most complex issues that this Congress has tackled, but simply put, this package will lock-in tax cuts for middle-class families, allowing more Americans to take home more money in their paychecks, save for retirement and make important investments for retirement," said Rogers. "It also supports continued small business growth by protecting tax reductions and incentivizing innovative technologies so we can create more jobs across the country."
The non-partisan Tax Foundation's analysis of Tax Reform 2.0 shows it will create 1.5 million new jobs, increase wages by 0.9 percent and increase the GDP by 2.2 percent. The tax reform plan also contains provisions to help local businesses provide retirement plans to their workers and includes reforms to help employees plan for retirement and expands uses of 529 education savings plans.
Tax Reform 2.0 protects lower tax rates, a doubled Child Tax Credit, the first-ever Paid Family Leave Tax Credit, doubled exemption from the Death Tax and elimination of the Alternative Minimum Tax for nearly 96 percent of those who paid it last year.
The Joint Committee on Taxation found that Tax Reform 2.0 will benefit low and middle class earners the most. Taxpayers with incomes under $50,000 will see their share of the total federal tax burden drop from 4.2% to 3.9%. Those with less than $10,000 in income will see their taxes slashed by more than half. Likewise, average taxpayers with incomes between $10,000 and $20,000, a group that frequently claims refundable tax credits, will have no tax liability and receive an additional refund.
For more information about Tax Reform 2.0, click here.