When the modern tax code was established in 1913, it contained only 400 pages of laws and regulations. Today, our tax code includes 70,000 pages of regulations!
In the last 10 years, there have been more than 4,400 changes.
Clearly, America is in need of a serious tax overhaul if we are to compete in a global economy.
Many of the major changes to our tax code involve special preferences, exclusions, or deductions for well-connected activities or groups. These special tax breaks and loopholes now cost the Federal Government more than $1 trillion each year in lost revenue.
Both parties are guilty of this abuse. Both parties need to stop it. Now.
While our tax code is riddled with loopholes, it is also extremely uncompetitive. The U.S. corporate income tax rate (incorporating Federal, state, and local taxes) is the highest in the industrialized world, topping out at just over 39 percent. This tax disparity discourages investment and job creation, distorts business activity, and puts American companies at a competitive disadvantage to foreign competitors. Other nations are lowering their corporate tax rate to lure business, including Canada, which lowered their rate to 15 percent in 2012.
Failure to address our corporate tax rate will leave the United States with an ever-shrinking role in the global economy.
The solution involves simplifying our tax code to promote job creation and economic growth. We should close unnecessary loopholes, which will allow for lower tax rates, which will pump more money into the economy. This is vital for every hardworking American, but especially to families and businesses in the 9th District still recovering from the demise of textiles and manufacturing.
Our economy is stuck in neutral. Raising taxes on hardworking Americans and small businesses is irresponsible and will further strangle economic growth. North Carolina families should be allowed to keep more of their hard-earned money and reinvest it into our economy.
As co-founder and co-chair of the United Solutions
caucus, I am working with a bi-partisan group of freshman United States Representatives to find common-sense, sustainable solutions to lower tax rates, broaden the tax base, and promote economic recovery.
This has been done before. President Reagan’s tax reforms, which inaugurated an era of great economic growth and success, passed the House of Representatives with bipartisan support when liberal Democrat Tip O’Neill was Speaker of the House. Now is the time to build upon President Reagan’s leadership and reform our broken tax code to put Americans back to work.