Congressman Vern Buchanan, a Republican from Sarasota, Florida, urged GOP congressional leaders on Monday to take advantage of a “a rare and golden moment” and pass sweeping legislation to lower corporate and individual taxes.
In a letter to House Speaker Paul Ryan and Senate Majority Leader Mitch McConnell, Buchanan said Republican control of the House, Senate and White House with President-elect Donald Trump, allows the GOP to “fundamentally overhaul the U.S. tax code and jump-start the economy.”
“The tax code punishes ordinary Americans and suffocates business growth. It’s time to fix the economy by simplifying the tax code and reducing rates on individuals and businesses,” Buchanan wrote.
Buchanan, a member of the tax-writing House Ways and Means Committee, said legislation he introduced in April, the “Main Street Fairness Act” should be “a prominent feature” of any new GOP plan.
The bill, co-sponsored by Rep. Charles Boustany, R-La., would ensure small business owners reap the same benefits as large employers under any future corporate tax reform legislation.
The proposal allows small businesses that file taxes as “pass-through” income – including partnerships, sole proprietorships, LLCs and S corporations – to pay the same effective tax rate as large companies.
“The concept behind my bill is also part of the tax cut package pushed by President-elect Donald Trump,” Buchanan wrote. “It’s clearly time that Washington stopped punishing small businesses and started helping them. The businesses that would be helped by my plan account for more than 68 million jobs.”
The current maximum tax rate for U.S. corporations is 35 percent, but small businesses can pay nearly 40 percent under the individual income tax code.
Despite the high base rate, the effective tax rate for U.S. corporations is typically much lower due to numerous tax breaks and loopholes that lower their actual tax burden.
Buchanan’s letter said his bill would “help Americans get a job, make more money and spend less time doing their taxes.”
“It’s time to give the American people a break,” Buchanan added. “People have been looking at their bank account balance with a knot in their stomach for too long.”