Morgan Griffith: The many benefits of tax reform
The Tax Cuts and Jobs Act, passed by Congress in mid-December and signed into law by President Trump on December 22 of last year, was crafted with a few important goals in mind. That you deserve to keep more of your hard-earned money. That we should encourage businesses to invest and grow in the United States, not overseas. That the people, not the government, know best how to prepare for the economy of tomorrow.
Achieving these goals would mean greater prosperity for Americans of all income levels. Although only a few weeks have passed since tax reform was enacted, our country is already seeing improvement. Tax reform has brought a steady stream of good news about our economy.
Tax reform means you can keep more of the money you worked hard to earn
My office was recently contacted by Glen, a retired Blacksburg police officer. He was happy to see an increase of $117.96 in his first retirement check this year. Glen is among the millions of ordinary Americans who can keep more of their money to save or invest in the ways that work best for them.
Businesses are also using their tax savings to reward their employees. According to the American Banking Association’s Banking Journal, for example, First Bank & Trust in Abingdon raised its minimum wage to $15 per hour as part of its plan to provide a large portion of its tax savings to its employees. Their sharing of savings with employees mirrors what has occurred across the country, from nationwide employers such as Walmart and CVS to local businesses.
For many hardworking Americans, this extra money, whether the dollars they get to keep instead of sending to the Federal Government or the higher wages and/or bonuses offered by their employers, will go a long way. They know these benefits aren’t “crumbs,” as House Minority Leader Nancy Pelosi (D-CA) derided them.
Tax reform means companies bringing back money from overseas to invest here in the United States
In January, the tech giant Apple announced it would bring hundreds of millions of dollars it had been keeping overseas back to our shores. Tax reform encouraged companies to bring money back by paying a one-time tax. According to Bloomberg, Apple will pay $38 billion into the Treasury.
With the money invested in the United States, Apple will spend $30 billion over five years for capital expenditures. It will create 20,000 jobs. It has already issued $2,500 bonuses to its employees.
The example of Apple shows that companies want to do business in the United States, but our old, byzantine tax code was a major deterrent. Tax reform helped unlock investments that will be put to good use here.
Tax reform means more money to invest in the future
Let’s take an area of particular importance to Southwest Virginia, broadband expansion. A recent hearing of the House Subcommittee on Communications and Technology focused on improving broadband infrastructure, especially in rural areas. Matthew Polka, President and CEO of the American Cable Association, testified that the new tax law would be a great help in building broadband infrastructure.
How would tax reform be good for broadband? Thanks to a lower corporate tax rate and immediate expensing of investments, his membership had more money to spend and more reason to spend it. He estimated that over 400,000 homes in unserved areas could enjoy high-speed connections.
Tax reform lets individuals and companies keep more money to invest in the future. With extra funds in hand, they are able to take chances on innovations that could change the world.
The American people were burdened too long by a tax code that did not respect their hard work, their creativity, or their dreams for the future. The Tax Cuts and Jobs Act sought to change that, and the news so far has been encouraging. I am hopeful that tax reform will continue to fuel prosperity, so all can have a shot at pursuing their American dreams.
If you have questions, concerns, or comments, feel free to contact my office. You can call my Abingdon office at 276-525-1405 or my Christiansburg office at 540-381-5671. To reach my office via email, please visit my website at www.morgangriffith.house.gov. Also on my website is the latest material from my office, including information on votes recently taken on the floor of the House of Representatives.