Ernst, Young hail tax bill's passage
(Washington) -- Republican congressional leaders call it an early Christmas present--the passage of the first major tax overhaul in more than 30 years.
By a 51-to-48 vote Tuesday, the U.S. Senate on a party line vote approved the $1.5 trillion tax reform bill. Among other things, the bill reduces the corporate tax rate from 35% to 21%, and includes individual tax cuts. Iowa Senator Joni Ernst is among the bill's supporters. Ernst told KMA News Wednesday morning the bill will boost the income of Iowa families.
"So, if we have a family that is able to save $100, $200 in a paycheck, those dollars can be used for their mortgages, their car payments--whatever they need to spend those dollars on, that's exactly what they should be doing," said Ernst. "It's their money, they should spend it as they see fit. That, in turn, generates growth in the economy. It's going to be very, very helpful for our rural Iowans."
Ernst is particularly pleased the compromise bill included her SQUEAL Act. An acronym for Stop Questionable Unnecessary Excessive Allowances for Legislators, Ernst's measure eliminates a provision of the tax code that allows members of Congress to deduct, for income tax purposes, up to $3,000 annually for living expenses in the Washington, D.C. area.
"That tax break is one that allowed members of Congress to deduct for their income tax purposes thousands of dollars annually for living in Washington, D.C.," she said. "So, this is something that's really important. If we're reforming the tax code, we need to be leaders on this and offer up our own tax breaks."
The Red Oak Republican says the bill also restores many of the tax deductions eliminated from the earlier House version, such as those for medical expenses.
"The bill we passed out, the House, thankfully agreed to that change," said Ernst, "and those deductions are still allowed."
While the House originally approved the bill earlier in the week, three technical changes in the Senate version sent the bill back to the House floor for a re-vote Thursday. Iowa Congressman David Young planned to support the bill--again--saying it would put money back in Iowans' pocketbooks.
"In Iowa, we are the middle class," said Young, "when you think about the heartland, and the guts of this district. People define themselves as the middle class. That's where I wanted to make sure that was my focus, to give those hard working folks tax relief--because they know how to spend it better than the government."
Many opinion polls show more than half of Americans opposed to the sweeping reform bill. Saying it's a matter of messaging, the Van Meter Republican says the bill must be sold to the American people.
"When I talk to Iowans in the 3rd district," he said, "and talk to them about what our intent is, and what we're doing, and the provisions, they respond very, very positively. I think the opinion of those will change as people will start feeling more money in their wallets, as this is implemented, and they see the economy grow healthier, and more jobs are created. So, it's a little matter of time for this to be implemented, and have this take effect."
Democrats opposed to the bill say the reform package will lead to cuts in Social Security, Medicare and Medicaid funding to cover debt accrued by the tax cuts. Young calls those comments "speculation."
"Nothing in this bill--I repeat--nothing in this bill makes cuts to Medicare and Social Security--period," said Young. "We in this country have made a promise to our neighbors and fellow citizens to make sure there are no cuts, and Social Security and Medicare are protected. I'm committed to fulfilling that promise."
Young made his comments as a guest on KMA's "Morning Line" program Wednesday morning. An estimate from the nonpartisan Joint Committee on Taxation indicates the bill will add more than $1 trillion to the national debt. Critics also point out that taxes will actually increase when the individual tax breaks expire in 2025, while the corporate tax breaks will remain intact.
