Two Central Illinois congressional representatives are weighing in on a major tax reform proposal rolled out by House Republicans Thursday.
The plan would cut corporate tax rates from 35 to 20 percent, increase the child tax credit from $1,000 to $1,600, and phase out the estate tax on wealthy individual's inheritance. The cap on the mortgage would be lowered to $500,000 from the current $1 million, and a deduction currently available on state income taxes would be eliminated.
401(k) rules would remain untouched, with the ability to contribute up to $18,000 to the retirement accounts on a tax-deferred basis.
U.S. Rep. Darin LaHood said the bill will bring relief to American taxpayers.
“Our nation has not seen comprehensive tax reform in over 30 years, which has resulted in middle income families having high rates while Washington special interests take advantage of loopholes," said LaHood. "That ends today as we put forth our plan to reform our tax code and bring relief to hard-working middle-class taxpayers while increasing paychecks. Not only are we doubling the standard deduction, which 69.4% of Illinois taxpayers in the 18th District use, but we also increase the child tax credit and simplify the filing process so that families keep more of their money and spend less of their time on taxes."
U.S. Rep. Cheri Bustos (D-East Moline) had a less optimistic take, branding the Republican "Tax Cuts and Jobs Act" as the "Billionaires-First" bill.
“When Paul Ryan and Mitch McConnell looked Americans in the eye and promised a tax reform package that would create jobs, that’s what we in the Midwest expected, but that’s not what this bill does,” Bustos said. “Instead, their bill is a shell game that will raise taxes on millions of hardworking families by capping state and local tax deductions while eliminating middle-class tax relief on things like student loan interest and medical expenses. Meanwhile, at a time when the Dow Jones keeps breaking records, their plan gives trillions of dollars to the ultra-wealthy on Wall Street while making it easier for big corporations to ship jobs overseas. The bottom line is that their plan will hurt job creation while sticking our next generation with the bill for trillions of dollars in new debt."
The bill will add an estimated $1.5 trillion to the federal deficit over the next decade.
To read the full bill, click here.
UPDATE: U.S. Rep. Rodney Davis (R-Taylorville) is adding his voice to the conversation on the tax reform plan.
“There are no two ways about it, the bill released today will allow average middle-income families to keep more of what they earn,” said Davis. “By improving areas of the tax code most utilized by the middle-class, the Tax Cuts and Jobs Act turns our tax code from one that only works for a select few, to one that benefits the majority of working Americans. In the coming days and weeks, members from both chambers and both sides of the aisle will have an opportunity to give their input and ensure we end up with the best possible bill for our country’s economy and the people we represent. We have an opportunity to change the lives of working Americans for the better and I hope Democrats will help us do that.”
A spokeswoman for U.S. Rep Adam Kinzinger (R-Channahon) said:
"It’s been 30+ years since we’ve had tax reform in this country. The Congressman is excited to see the process of tax reform get under way. He is reading through the House GOP plan, along with members of our staff, to review the legislation and take careful consideration of how it will impact IL-16 and our local & national economies."