Trump and Republicans have to make the tax code great again
© Getty Images

President Trump has taken significant actions in his first seven months in office to remove the layers of burdensome regulation that restrict energy affordability and reliability in the United States. Acknowledging the importance of the U.S. energy industry to economic growth and jobs, the president has championed achieving “energy dominance,” bringing a refreshingly different vision to energy and the environment policy than his predecessor.

The administration's efforts to boost exports of American energy resources to a global market and expand development here at home will create more affordable and reliable energy. Significant changes include expediting the permitting and approval processes of liquid natural gas terminals and exports, as well as expanding policies that allow offshore oil and gas drilling.

ADVERTISEMENT
“This is only the beginning,” the president said in a speech earlier this year that promised the “golden era of American energy.” This exciting new future should not stop with energy policy. President Trump has a historic opportunity to extend this vision of economic dominance to another important policy area: our broken federal tax code.

 

Today’s tax code undermines U.S. competitiveness on the domestic and the global fronts, denying hardworking Americans higher wages, better jobs, and more opportunities for their families. Just as President Trump has called for "a complete review" of major areas of U.S. energy policy, so should he review and reform U.S. tax policy.

With a tax environment as hostile to investment as ours, it's no wonder why American companies keep trillions in profits overseas and move their headquarters and jobs beyond our borders. Bringing down the corporate income tax rate — which is currently the highest in the developed world, at a top marginal rate of 35 percent — would cut at the heart of the problem.

Switching to a territorial system, as opposed to our current worldwide one, would mean that companies would not be taxed twice on repatriated earnings or face other penalties for having headquarters in the United States. Thankfully, tax reform talks are on the right track in Washington.

The Trump administration unveiled a tax reform vision earlier this year that addresses many of these problems by lowering rates, reducing complexity and igniting economic growth. Other high-level details include repealing the death tax, increasing the standard deduction to $24,000, and getting rid of loopholes that benefit politically-connected special interests at the expense of everyday families. Tax writers in Congress are translating these concepts into legislative text over August recess and lawmakers will consider these bills in committee after they return.

The consensus among conservatives in Washington to accomplishing tax reform is fierce. The recent joint statement from the “Big Six” — Treasury Secretary Steve Mnuchin, National Economic Council Director Gary Cohn, House Speaker Paul RyanPaul Davis RyanAmash storm hits Capitol Hill Debate with Donald Trump? Just say no Ex-Trump adviser says GOP needs a better health-care message for 2020 MORE (R-Wis.), Senate Majority Leader Mitch McConnellAddison (Mitch) Mitchell McConnellOvernight Health Care — Presented by PCMA — McConnell, Kaine offer bill to raise tobacco buying age to 21 | Measles outbreak spreads to 24 states | Pro-ObamaCare group launches ad blitz to protect Dems GOP senator warns Trump, Mulvaney against 'draconian' budget cuts Overnight Defense: Iran tensions swirl as officials prepare to brief Congress | Trump threatens war would be 'end of Iran' | Graham tells Trump to 'stand firm' | Budget talks begin MORE (R-Ky.), Ways and Means Chairman Kevin BradyKevin Patrick BradyMicrosoft, other business leaders head to Capitol Hill in support of carbon tax House to vote on retirement bill next week House chairman issues subpoenas for Trump's tax returns MORE (R-Texas) and Finance Chairman Orrin HatchOrrin Grant HatchTrump gambles in push for drug import proposal Biden's role in Anita Hill hearings defended by witness not allowed to testify 'Congress' worst tax idea ever'? Hardly. MORE (R-Utah) — signaled strong commitment to a shared vision. The decision to drop the border adjustment tax from future plans was a wise move to drive consensus.

President Trump and both political parties in Congress should not squander this historic opportunity to bring dominance to the tax code and make it work better for American families and industries. Policymakers face a number of deadlines in September, such as negotiations on lifting the debt ceiling and funding the government, but they should not let these slow their momentum behind getting tax reform done.

Christine Harbin is vice president of external affairs at Americans for Prosperity.


The views expressed by contributors are their own and are not the views of The Hill.