People across America are tired of dealing with the confusing and time-consuming U.S. tax code. In fact, the tax code is such a mess that 9 out of 10 individual taxpayers now hire a professional tax preparer or purchase software in order to successfully file their taxes.
In addition to costing American families hundreds of dollars each year, the effort required to comply with our broken tax code costs precious time and impacts productivity. In fact, a recent study by the Tax Foundation reports:
- “Americans will spend more than 8.9 billion hours complying with IRS tax filing requirements in 2016. This is equal to nearly 4.3 million full-time workers doing nothing but tax return paperwork.”
- “The majority of the 8.9 billion hours will be spent complying with U.S. business (2.8 billion hours) and individual income (2.6 billion hours) tax returns.”
- “Put in dollar terms, the 8.9 billion hours needed to comply with the tax code computes to $409 billion each year in lost productivity, or greater than the gross product of 36 states.”
It doesn’t have to be this hard.
Ways and Means Republicans believe Americans shouldn’t have to spend so much time and energy complying with our broken tax code. In June, as part of Speaker Ryan’s Better Way agenda, we unveiled “A Better Way for Tax Reform.” This bold Blueprint for pro-growth tax reform brings much-needed simplification and fairness to the tax code while also including innovative provisions to support American families and job creators.
Here are a few ways the Blueprint will help free taxpayers and job creators from the web of complexity associated with tax compliance today and promote economic growth:
1. Simplifying the filing process to save time and money.
The current U.S. tax code has grown into an incredible frustration for taxpayers. Under our tax reform Blueprint, all of this would change. By lowering the tax rates, increasing the standard deduction, and ending a host of special interest provisions, our Blueprint dramatically simplifies the tax code for taxpayers. In fact, our Blueprint ensures that come Tax Day, most Americans will be able to file their taxes on a form as simple as a postcard.
2. Ending the maze of special interest provisions so the code is easier to understand.
When the American people look at the current U.S. tax code, many of them see a maze of loopholes that support special interests but offer little help to them and their families. And, even more frustrating, the tax relief provisions that are available to families can be confusing and difficult to utilize.
Our Blueprint eliminates this maze of special interest loopholes in order to simplify the code dramatically and lower tax rates for individuals and families. By also making it easier for Americans to save and invest in what’s important to them, our Blueprint will promote job creation and economic growth while ensuring Americans spend far less of their time and take-home pay on tax compliance.
3. Supporting job creators with full tax write-offs.
When American job creators buy new equipment, today they face complex depreciation rules, which allow the business to write off the purchase over a sometimes long – and often arbitrary – period of time. Too often, these rules require businesses to hire accountants to determine how each asset must be treated for tax purposes – funds they can’t invest in growing their business or increasing worker salaries.
With full and immediate expensing, our Blueprint dramatically simplifies these rules by allowing businesses to immediately write off the costs of new capital investments in full. As Chairman Brady explained in the Wall Street Journal: “Full and immediate expensing is widely recognized as one of the most pro-growth tax policies around … with these savings, businesses across the country will have more freedom to grow, hire new workers and increase wages.”
Unlike those who want to expand the U.S. tax code by adding new restrictions, regulations, and special interest loopholes, Ways and Means Republicans want to expand the U.S. economy through tax reform that makes the code dramatically simpler and fairer for families and job creators.
CLICK HERE to learn more about our bold Blueprint for pro-growth tax reform.