04.01.25

Republicans Are Fighting for Families and Main Street America

The 2017 Tax Cuts and Jobs Act Provided Widespread Tax Relief and Economic Growth to Americans and Small Businesses, and Letting Those Cuts Expire Would Have Costly Consequences

THE TAX CUTS AND JOBS ACT RESULTED IN LOWER TAXES, HIGHER WAGES, AND A BOOMING JOB MARKET

  • “The Joint Committee on Taxation — Congress’s nonpartisan team of tax analysts — found that every income group would see a tax cut on average.” (The New York Times: Face It: You (Probably) Got a Tax Cut – 4/14/19)
  • The Tax Cuts and Jobs Act (TCJA) has been responsible for creating over 1.4 million jobs nationwide since its passage in 2017. (Tax Foundation: The Jobs Impact Of The Tax Cuts And Jobs Act By State, 2018-2027 – accessed 3/24/25)
  • Before the pandemic, the results were clear: “The job market doesn’t get much better than this. The U.S. economy has added jobs for 100 consecutive months. Unemployment recently touched its lowest level in 49 years.” (The Wall Street Journal: Inside the Hottest Job Market in Half a Century – 3/1/19)
  • “All sorts of people who have previously had trouble landing a job are now finding work.” (The Wall Street Journal: Inside the Hottest Job Market in Half a Century – 3/1/19)
  • “Workers are receiving the fattest wage increases since the Great Recession as employers struggle to find enough people to fill their ranks and employees have more leverage to demand higher pay and jump to better jobs.” (The Washington Post: Workers suddenly have more power to demand higher pay and better jobs – 3/8/19)
  • The year after the TCJA was passed, wages grew 3.4%, “the fastest pace in nearly a decade and well above inflation.” (The Washington Post: Workers suddenly have more power to demand higher pay and better jobs – 3/8/19)
  • “[T]he tax breaks have been a boon for small businesses.” (CNBC: Small businesses cheer Trump tax reforms, but some feel they didn’t go far enough – 3/18/19)
  • Nearly 80% of National Federation of Independent Business (NFIB) members polled in their 2021 Tax Survey report “described the tax law positively, compared to just 8% who had a negative view of the tax law.” (NFIB Research Center: NFIB Tax Survey 2021 – accessed 3/24/25)

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(Tax Foundation: Testimony: Reviewing Recent Federal Tax Policies and Considering Pro-Growth Reforms – 6/22/23)

IF TCJA PROVISIONS ARE ALLOWED TO EXPIRE, WORKING AMERICANS WILL SEE THEIR TAXES GO UP

  • “[L]etting the tax reforms lapse would result in a $4 trillion tax increase in 2026...” (The Wall Street Journal: Editorial: Republicans Reconcile on Taxes – 2/14/25)
  • For American families, the expiration of the TCJA will hurt their bottom line:
    • An average family of four making $80,000 would see a $1,700 tax increase. (Tax Foundation: Tax Calculator: How the TCJA’s Expiration Will Affect You – 3/12/24)
    • Nearly 6 million jobs would be put at risk. (National Association of Manufacturers: NAM Study: Tax Provisions’ Expiration Will Cost U.S. Jobs, Wages, GDP – 1/14/25)
    • GDP would shrink by $1.1 trillion. (National Association of Manufacturers: NAM Study: Tax Provisions’ Expiration Will Cost U.S. Jobs, Wages, GDP – 1/14/25)
    • Employees would lose approximately $540 billion in compensation. (National Association of Manufacturers: NAM Study: Tax Provisions’ Expiration Will Cost U.S. Jobs, Wages, GDP – 1/14/25)
    • The child tax credit would return to $1,000 per child, down from the TCJA level of $2,000. (Bloomberg Government: Will Trump and Congress Extend TCJA Tax Cuts? – 2/20/25)
    • The standard deduction, which nearly 90 percent of taxpayers claim, would be cut roughly in half. (Tax Foundation: Nearly 90 Percent of Taxpayers Are Projected to Take the TCJA’s Expanded Standard Deduction – 9/26/18)

Standard deductions before and after TCJA

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(Bloomberg Government: Will Trump and Congress Extend TCJA Tax Cuts? – 2/20/25)

SMALL BUSINESSES, THE ECONOMIC BACKBONE OF AMERICA, NEED AND DESERVE LONG-TERM TAX CERTAINTY – NOT HIGHER TAXES

  • The TCJA “created a new deduction of 20% of net income for many pass-through business owners, effectively lowering their top rate to 29.6% from 37%.” This deduction is set to expire at the end of this year and “was the shining star of TCJA…” (The Wall Street Journal: The New Tax Law: Pass-Through Income – 2/13/18; Thomson Reuters: What to know about TCJA expiration – 9/13/24)
  • “Tax breaks enacted to help small businesses aren’t permanent, and that’s made it difficult for business owners to make long-term decisions.” (CNBC: Small businesses cheer Trump tax reforms, but some feel they didn’t go far enough – 3/18/19)
  • Extending the small business tax deduction will continue to ensure that pass-through businesses, which employ 62% of private sector employees, can compete with larger, public corporations. (Main Street Employers: 199A: The Main Street Business Deduction – accessed 3/24/25)
  • Nationally, 96% of small businesses are considered pass-through businesses, comprising 33 million businesses that employ more than 68 million workers. (EY on Behalf of NFIB: Macroeconomic impacts of permanently extending the Section 199A deduction on small businesses – Sept. 2024)
  • A September 2024 report estimated that a permanent extension of the small business tax deduction would create 1.2 million jobs annually over the first ten years, growing to 2.4 million per year in the long run. (EY on Behalf of the NFIB: Macroeconomic impacts of permanently extending the Section 199A deduction on small businesses – Sept. 2024)
  • The Tax Foundation estimates that making the TCJA permanent would increase GDP in the long-run by 1.1%. (Tax Foundation: Options for Navigating the 2025 Tax Cuts and Jobs Act Expirations – 5/7/24)
  • If the small business tax deduction is allowed to expire, “taxes will increase on over 30 million small businesses at the end of 2025.” (NFIB: Small Businesses Praise Reintroduction of the Main Street Tax Certainty Act – 1/23/25)
  • According to the 2024 NFIB Tax Survey, “61 percent of small business owners reported they would likely raise prices, and 44 percent would postpone or cancel capital investments” if the TCJA expires. (NFIB Research Center: 2024 NFIB Tax Survey – accessed 3/24/25)