Congressional Republicans and President Trump campaigned to reform the U.S. tax code to foster economic growth and create jobs. The most recent successful effort to significantly reform the tax code happened more than 30 years ago under President Reagan. Now is a critical time to make a once-in-a-generation change to the tax code, but it won't be easy.
House Republicans unveiled their tax reform blueprint, "A Better Way," in summer 2016. President Trump discussed numerous tax reform proposals throughout his campaign but released broad principles earlier this year. The two proposals agree on several provisions but differ in some ways. NRCA looks forward to working with President Trump and Congress to institute tax reform that lowers rates for all businesses.
Tax rates are key
Lowering tax rates for individuals and corporations has long been a top priority for NRCA. Currently, pass-through businesses pay their taxes with individual tax code rates as high as 39.6 percent; the rate can reach into the high 40s when factoring in state, local and other taxes. Both the House Republican proposal and President Trump's proposal would create a special tax rate for pass-through businesses to pay their business taxes at a lower rate than individual rates. The House Republican proposal calls for a pass-through business rate of 25 percent with a top personal rate of 33 percent. President Trump's proposal calls for a business rate of 15 percent with a top personal rate of 35 percent.