As an elected representative I often read articles and editorials that criticize me or the votes I take: it comes with the job. I usually just shrug them off and get on with my work. The recent editorial piece in the Aurora Sentinel, however, is one where I need to set the record straight.
To start: I voted ‘Yes’ on H.R 1, the Tax Cuts and Jobs Act. I did so because this bill – while not perfect— is, overall, a pro-growth, pro-family, bill that will help millions of Americans…. Not, as the Sentinel insinuates, one to cynically heap riches on plutocrats.
The Sentinel is wrong to say there is no “single, credible analysis … showing that this plan wouldn’t seriously hurt some of the country’s most vulnerable Americans… every review reveals that the bill would inarguably run up massive amounts of national debt…” The Tax Foundation (TF), a respected nonpartisan think tank, expects the bill to lead to 3.5% higher GDP over the long run, generating economic growth that will increase federal tax revenue by nearly a trillion dollars over a decade, adding, “depending on the baseline used to score the plan, current policy or current law, the new revenues could bring the plan close to revenue neutral.”
Aside from the dubious claim that the bill would, in the worst case, increase the deficit by $1.5 trillion the Sentinel also writes that “reform can’t come at the expense of a vast part of America already hurt by stagnant wages and endless hikes in housing, healthcare, utilities, property taxes, and college.” I agree with that statement, and that is why I voted yes. In fact this tax bill will help the vast majority of Americans. The bill is predicted to result in higher wages and nearly a million more jobs. More jobs means more demand for labor and increased demand for workers increases wages. Most middle and working class Americans will also see a decrease in what they owe to the Internal Revenue Service. In Colorado, according to the TF, the projection is nearly 16,000 new jobs and an additional $2,682 in income for the average middle-income family.
The Sentinel argues that taxpayers will be worse off if we eliminate many deductions. That would be true, if we were not also cutting rates for everyone but the top income earners while doubling the standard deduction. Only taxpayers who itemize their deductions currently benefit from most of the deductions proposed for elimination in H.R. 1. According to the Congressional Research Service in 2014, 30% of taxpayers itemized; the majority of taxpayers with less than $100,000 in income simply take the standard deduction. Currently, in Colorado only one third of taxpayers itemize and that number will decrease significantly under the new tax code; none of the current non-itemizers will notice the absence of those deductions and all those who will not itemize in the future will benefit from the increased standard deduction. Taxpayers with families, whether they itemize or not, will also receive an enhanced child tax credit (increasing the current $1,000 to $1,600) that grows with inflation—plus a $300-per-person credit for all dependents. These credits directly reduce the amount of tax the taxpayer owes and can even be refunded. All of this while making their taxes far easier to file, saving them time and money — something the Sentinel grudgingly admits.
Finally, and most importantly with H.R. 1, we address the very economic stagnation that the Sentinel is rightly concerned about— without inordinately benefitting the “rich, the very rich, and the super-rich”. This tax plan maintains the top income tax rate as it currently stands – 39.6% – for individuals making over $500,000 or couples making over $1,000,000. Those wealthier individuals who itemize are the ones most impacted by the loss of many of the deductions (loopholes) which so concerns the Sentinel.
Finally, the Sentinel does get one thing right. It calls for a tax reform that grows the economy and improves the lives of average Americans—unfortunately it fails to admit H.R. 1 will do just that. Again, I freely admit that as with any large and complex bill, H.R. 1 is imperfect. Now, the effort moves to the Senate, where I expect to see some significant changes. I hope such changes only strengthen the benefits it will deliver for hard-working, middle class Americans.
The time to strengthen our community and its economy with a fair and simpler tax code is now.
Republican U.S. Rep. Mike Coffman represents the 6th Congressional District.