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Hatch Remarks at Finance Committee Markup of Tax Cuts and Jobs Act
WASHINGTON – Senate Finance Committee Chairman Orrin Hatch (R-Utah) today delivered the following remarks at the committee markup of the Senate tax overhaul package, the Tax Cuts and Jobs Act:
Today, we will continue our consideration of the chairman’s mark, as modified, for the Tax Cuts and Jobs Act. Having walked through both the mark and modification, with extensive questioning and discussion, we began consideration of amendments last night.
Admittedly, things were a little chaotic at the outset and I know some tensions ran high. We’re going to improve the process and communication today and, hopefully, make things move a little more smoothly.
With that issue addressed, I’d like to say a few words about the tone of our discussion this week, because I think it has been a problem.
As I’ve said, I don’t begrudge anyone for holding a passionate viewpoint on any issue. And, I don’t doubt my colleagues’ sincerity in any views they express or any votes they take. But, for the committee to operate, we need to be respectful and allow the debate to unfold in an orderly fashion.
Members are, of course, free to disagree about any issue. But no one should interrupt another member, shout down the other side, or impugn their colleague’s motives on substantive or procedural disagreements.
We saw quite a bit of that yesterday, and some of it was pretty inflammatory.
As for myself, I can take it – I can guarantee that, in my 40 years in the Senate, I’ve been called worse names than anyone on this committee would come up with. But, for the good of the committee, I want to urge my colleagues to dial back the rhetoric and turn down the volume of some of our arguments.
This is the last time I will raise issues about process for the duration of this markup, because, in my view, if we’re going to have a lively debate, it should be about policy.
So let’s talk about policy differences for a moment. Let me reiterate what our bill does.
Our bill gives tax relief to individuals and families across the board, with the middle class getting the largest benefit, relative to their income. We provide this relief primarily by cutting rates and expanding credits for parents and families.
Our bill will also help businesses of all sizes. Our pass-through solution is simple and effective, which is why the bill is supported by the National Federation of Independent Businesses and most other small business organizations.
The business section of the mark also includes, among other things, a significant reduction in corporate rates. I know my colleagues have characterized this in a number of ways. But, this is not some radical, right-wing approach.
As I’ve noted, members of this committee on both sides have supported the proposition of lowering corporate rates for years now. The ranking member actually introduced legislation that would have reduced the rate to 24 percent. Yet, now it appears that the notion that we’d even consider moving down from the highest corporate tax rates in the industrialized world is something totally abhorrent to Democrats.
I’ve yet to hear an explanation from anyone on the other side as to why they’ve changed their minds and are now characterizing our efforts to modernize America’s business tax system as a “corporate giveaway.” That would be interesting to hear.
As we debated at length yesterday, the mark will also zero out the punitive individual mandate tax established under Obamacare. Despite claims to the contrary, we contend that this is a pro-family, pro-middle class, and pro-growth proposition. It will undo one of the most regressive taxes in the tax code, and allow us to provide additional tax relief to middle-class families.
By now, I’m sure most of my colleagues are aware of the most recent developments with JCT’s updated distributional analysis. I expect our friends on the other side will try to make some hay out of the new table this morning, and that’s their right.
But, I want to provide some context before that begins. We developed a modification to the chairman’s mark that included additional tax relief for families throughout the middle class. Once again, it expanded further the child tax credit, made it more refundable, and provided it to a greater number of families with children. We also adjusted the rates downward for middle class families. And, of course, we relieved those middle and lower income families of the burdens imposed by the individual mandate tax.
With those changes in place, JCT noted a projected uptick in taxes owed by those in some lower income brackets. Obviously, we have no intention of raising taxes on these families. Every Republican on this committee has been committed to providing tax cuts to every income cohort.
So, here’s the rub, JCT’s analysis doesn’t show that we’re raising taxes on lower income Americans. We’re seeing some taxes go up in the distributional analysis because of a scoring assumption, not because of tax rates or even tax policy.
Congressional scorekeepers have assumed that, if the individual mandate were to be repealed, a segment of people will opt voluntarily to not get health insurance. The assumption extends even to those who currently get their insurance for free under Medicaid.
So, JCT began with an assumption that some people in the lower income brackets will opt to not purchase health insurance and thus not take advantage of available tax credit subsidies. Without those credits, they see an overall uptick in their tax liability.
I don’t fault JCT for this. They have to make assumptions in order to make credible projections.
However, in the world that exists outside of those assumptions, people will be making their own choices. In fact, our bill will give them additional freedom to do so.
Nothing in our mark will impact the availability of premium subsidy credits.
Nothing in the mark will direct or suggest to taxpayers that they should not take advantage of the credits.
This is the result of an assumption about economic behavior that is 100 percent voluntary.
I believe JCT has additional data that will demonstrate that, but for the behavioral assumptions that accompany the repeal of the individual mandate tax, our mark provides significant relief to all low- and middle-class income brackets.
I know that we’re going to hear arguments to the contrary this morning, but let’s be clear: Anyone who says that we’re hiking taxes on low-income families is misstating the facts. Anyone who says people will see their taxes go up because we’re taking away their health insurance is also misstating the facts.
To view a full copy of the chairman’s modified mark, click here.
A score of the modified mark may be found here.
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