"90 percent of middle-income taxpayers will see a lower tax bill next year thanks to the TCJA.
Over 87 million Americans are set to see lower utility bills this year thanks to tax reform as well"
The House Ways and Means Committee is about to hold its first hearing on the Tax Cuts and Jobs Act (TCJA). It should be an opportunity for celebration. Though it is still early, tax reform has laid the groundwork for a stronger economy with better wages for all while returning taxpayers’ hard-earned money to their wallets.
Americans at all income levels have a lot to thank Congress for already. The left-leaning Tax Policy Center found that over 90 percent of middle-income taxpayers will see a lower tax bill next year thanks to the TCJA. Over 87 million Americans are set to see lower utility bills this year thanks to tax reform as well.
On top of this, millions of Americans have already received special bonuses and increased retirement plan contributions as a result of tax reform.
Of course, as many have pointed out, these bonuses are just that: bonuses. While meaningful (and certainly more to workers than “crumbs”), they’re not the long-term wage increases that many Americans have gone too long without seeing. Fortunately, the TCJA is on its way to delivering those as well.
While many on the left have ridiculed the idea that cuts to the corporate rate would benefit workers, the improvement to wages comes over the long term. Wage increases come from capital investment, as capital investment makes workers more productive. More productive and efficient workers are more valuable to businesses, requiring them to compensate them more to keep them on board. The TCJA was designed with this fact in mind.
Despite naysayers claiming that corporations would put the tax windfall solely towards stock buybacks and dividends, early results indicate that economy-wide capital investment is indeed on the rise. In the first quarter of 2018, capital expenditures increased by 39 percent, the fastest growth rate in seven years.
All in all, Americans should be celebrating a return to sound economic policy which returns money to taxpayers’ pockets while enabling businesses to innovate and grow. The Ways and Means Committee should join them.
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