U.S. Senate Majority Leader John Thune (R-S.D.) spoke on the Senate floor about the release of new legislation by the Senate Finance Committee that aims to make permanent several provisions from the 2017 Tax Cuts and Jobs Act. Thune emphasized that these tax cuts, which include reduced rates for all income brackets, a doubled child tax credit, and an increased standard deduction, are set to expire at the end of this year.
According to Thune, if Congress does not act before these provisions expire, Americans earning less than $400,000 annually could see a $2.6 trillion increase in taxes starting in 2026. He cited estimates that a typical family of four making $80,000 would owe an additional $1,700 in taxes.
“Republicans promised the American people that we wouldn’t let that happen. And with the release of the Finance Committee’s text, we are one step closer to delivering on that promise,” Thune said.
The proposed legislation would not only extend but also make permanent the lower tax rates, larger child tax credit, and higher standard deduction established by the 2017 law. Additionally, it proposes increasing the child tax credit by another $200 permanently.
Thune highlighted other measures included in the bill such as suspending taxes on tips for tipped workers and overtime for hourly workers. The bill also proposes suspending taxes on auto loan interest for new cars made in America and increasing the standard deduction for low- and middle-income seniors.
On business taxation, Thune described how earlier reforms lowered rates for small businesses and corporations to improve competitiveness globally and encourage investment domestically. He said many of those provisions are also expiring or phasing out soon but would be extended permanently under this legislation.
He pointed to economic outcomes following passage of the original Tax Cuts and Jobs Act—such as higher GDP growth than projected, increases in real wages, lower unemployment rates, decreased poverty levels, and greater business investment—as evidence supporting further extension of these policies.
Thune referenced analysis from both government agencies: “The Council of Economic Advisers – which accurately predicted the economic and wage growth that we achieved in the wake of the Tax Cuts and Jobs Act – is forecasting 2.9 percent to 3.5 percent long-run GDP as a result of our legislation.” He also noted Congressional Budget Office estimates have historically underestimated resulting revenues from such measures compared to actual outcomes.
Additional elements in the proposal include creating savings accounts for newborns with an initial deposit intended to help parents invest for their children’s future needs.
“Everything we’re doing in this bill is for the sake of making America stronger and more prosperous,” Thune stated during his remarks. “Working Americans – working Americans … are going to have a better life because of this legislation.”
He concluded by thanking Chairman Crapo and members of the Senate Finance Committee for their work on drafting these proposals.
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