LANSING, Mich. — The Michigan Senate on Thursday adopted State Sen. Jim Runestad’s resolution to urge Congress to permanently extend the Tax Cuts and Jobs Act of 2017 with commensurate spending cuts to avoid increasing the federal tax burden.
“Reckless Washington spending and heavy-handed unilateral shutdowns imposed by go-it-alone governors like our own during the coronavirus pandemic have resulted in historic inflation and economic hardships not seen in decades,” said Runestad, R-White Lake. “It is imperative that lawmakers work to help taxpayers climb out of this government-created hole by reducing unnecessary spending and ensuring that hardworking Americans are able to keep their own money.”
Senate Resolution 154 says, “Prior to the government-mandated economic shutdowns during the COVID-19 Pandemic, the Tax Cuts and Jobs Act of 2017 (TCJA) spurred steady economic expansion and allowed the spirit of entrepreneurship to flourish, while creating new jobs and opportunities for tens of millions of Americans. The act resulted in a $1.5 trillion net tax cut, and was followed by historically low unemployment rates, an increase in business investment, and a $6,000 increase in real median household income over the next two years.”
The 2017 tax cuts reduced federal tax rates for households across every income level, resulting in over $1,500 in tax relief for average middle-income earners, according to the American Legislative Exchange Council (ALEC). Before the TCJA, the top corporate income tax rate in the U.S. was 35%, the highest among all nations in the Organization for Economic Co-operation and Development; the law reduced the business tax rate to 21%, bringing the U.S. back into the average among member nations, and dramatically enhancing American competitiveness.
“As hardworking taxpayers continue to suffer the damaging effects of inflation, continuing the benefits of the federal Tax Cuts and Jobs Act of 2017 is now more important than ever. These provisions include crucial changes such as the reductions in personal income tax rates, the near doubling of the standard deduction and the substantial reduction of the hated Alternative Minimum Tax. The Tax Cuts and Jobs Act of 2017 proved to be a big boost for all Americans,” said Jonathan Williams, ALEC chief economist and executive vice president of policy.
Most of the TCJA’s requirements are currently set to end by Dec. 31, 2025.
“Allowing these tax cuts to expire would result in a huge federal tax increase on the American people and further inhibit the recovery of our shared economy,” Runestad said. “History shows us that the people know how to spend their own money far better than the government and our whole nation prospers when they have the freedom to do so. I hope Congress will extend the Tax Cuts and Jobs Act and reduce irresponsible federal spending, giving confidence to taxpayers to invest in their own futures and rebuild a booming American economy.”
Copies of SR 154 will be delivered to the speaker of the U.S. House of Representatives, the president of the U.S. Senate and members of Michigan’s congressional delegation.