u have all heard the quote before: “In this world nothing can be said to be certain, except death and taxes.” Just this week, many Americans are scrambling as we hit the filing deadline for 2016 individual tax returns.
Studies have shown that American families spend over 6 billion hours a year filing their taxes. That adds up to almost 700,000 years. Those numbers are astonishing.
The numbers also demonstrate the very serious challenges caused by our complex tax code. It is too long, too complicated, and too hard to understand. Americans are forced to spend precious time researching, studying, or paying for services just to figure out how much money they owe the government. There is something wrong with that picture.
Individuals aren’t the only ones who are hit hard by our complicated and outdated tax code. At 39.1%, the United States has the third highest top marginal corporate tax rate in the world. Only Chad and the United Arab Emirates have a higher rate. With a tax code that is thousands of pages long, businesses large and small spend billions of dollars on fees paid to accountants and tax lawyers to file their taxes.
There is a better way. Congress can eliminate hundreds of deductions and credits, many of which benefit only one or a handful of special interests, and use those savings to substantially lower tax rates for individuals and businesses.
This would create a fairer, simpler, and cleaner tax code. If done correctly, most Americans would only have to fill out a one page return and at the same time pay less in taxes. With lower rates, American corporations could better compete in the world economy, businesses of all sizes would have a level playing field, and more jobs would be created.
This type of reform is long overdue. In fact, it has been almost 30 years since Congress last made significant reforms to the tax code.
If you are wondering whether or not tax reform can grow the economy, just look at what happened in the 1980s under President Reagan. In 1981, President Reagan helped push a 25 percent across-the-board tax cut through Congress. He followed that up in 1986 with the largest simplification of the tax code ever achieved.
These reforms clearly worked and the economic statistics prove it. From 1982 through 1990, our country experienced the longest period of sustained economic growth during peacetime in American history. The economy grew by about one-third in real, inflation-adjusted dollars. Tax reform is without a doubt a boon for the economy.
That’s why I have co-sponsored a bill that would help force Congress to take up the very serious issue of tax reform. H.R. 27, the Tax Code Termination Act, would sunset the current tax code on December 31, 2019. By putting an end date on the tax code, Members of Congress on both sides of the aisle would have no choice but to get serious about rewriting the entire tax code.
People will say that tax reform is too hard and that it can’t be done in today’s political climate. But I don’t believe I was elected to make easy choices. Instead, I was elected to work toward commonsense solutions that help the American people. A simplified tax code is exactly the type of the reform the American people are looking for.
So as this Tax Day comes and passes, I vow to continue fighting for a simplified tax code that makes life easier for American families while also promoting economic growth.