TEXARKANA MAGAZINE
THE 2025 TAX SHOWDOWN WHY CONGRESS MUST EXTEND THE TCJA BY NATHANIEL MORAN, UNITED STATES REPRESENTATIVE, TEXAS FIRST CONGRESSIONAL DISTRICT
T his year, there will be two Super Bowls for Americans to watch. One will be played on a physical field made of artificial turf, highlighting two high-caliber professional football teams, while the other—something I like to call the “Super Bowl of Tax Policy”—will be played on the political field of Washington, D.C., highlighting two very different economic philosophies. One pushing higher taxes and more government spending, and the other one fighting to reduce the tax burdens on Americans. I, of course, will be on the side of lower taxation. I will stand for increased freedom from the burden of government. I will also support hard-working East Texas families and their businesses. While it may lack the glitz and glamor of its sporting counterpart, the political Super Bowl of Tax Policy will be far more significant to the future of America’s economy and the financial security of its citizens than the one played on the gridiron. This battle will be especially crucial as provisions of President Donald Trump’s 2017 Tax Cuts and Jobs Act (TCJA), which brought significant tax reforms under the first Trump Administration, are set to expire on December 31, 2025, potentially reshaping the financial landscape for millions of Americans and small businesses. If Congress does nothing (which it is good at doing), the result will be a de facto tax increase of $4.6 trillion in 2026—the largest tax increase in American history. So, inaction is not an option. In 2017, President Trump signed into law one of the most comprehensive tax reforms and tax cuts this nation has seen since the days of President Ronald Reagan in 1986—the TCJA. The TCJA was the result of a multi-year tax reform process that simplified
taxes for small businesses and families and lowered the corporate tax rate from 35% to 21%, making the U.S. more competitive and encouraged companies to bring profits back to America. Before this 2017 tax reform package, American companies paid the second highest corporate tax rate of any country across the globe—second only to Japan. At the time, the U.S. corporate tax rate was even ten percent higher than the corporate tax rate of 25% imposed by the Chinese Communist Party. This disparity undercut our global competitiveness and drove businesses to move overseas. But, after the TCJA, businesses stayed put in the U.S., and American families took home more of their hard-earned money. And—not surprisingly—after the TCJA went into effect, the economy grew by more than 1% above its predicted growth, which resulted in higher aggregate revenue receipts. America witnessed firsthand, real, tangible growth due to a lower tax rate that made doing business in America competitive again. And, the TCJA benefited every sector of the economy, particularly lower- and middle-class families, by lowering taxes and contributing to a strong, stable economy. This led to wage growth and the creation of 5.8 million jobs in the 28 months following its passage. The unemployment rate dropped dramatically, reaching 3.5% in September 2019—the lowest level since 1969. Additionally, real median household income hit an all- time high of $78,250 in 2019, growing by more than 8.5% from 2017 to 2019. If the TCJA were to expire on December 31, 2025, tax hikes would take a significant toll on American families and workers. In Texas alone, the average taxpayer would face a 23% hike in their
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BUSINESS & POLITICS
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