canada africa partner reservation Florida Rep. Greg Steube says big tax hike coming if Biden allows ‘Trump tax cuts’ to expire if re-elected

Florida Rep. Greg Steube says big tax hike coming if Biden allows ‘Trump tax cuts’ to expire if re-elected

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Florida Representative Greg Steube (Fox Business)Florida Representative Greg Steube (Fox Business)
Florida Representative Greg Steube (Fox Business)

The Tax Cuts and Jobs Act (TCJA), introduced in 2017 under the Trump administration, significantly reshaped the tax landscape in the United States.

However, now that President Joe Biden is seeking re-election, he has pledged to let these tax cuts expire, setting the stage for a possible showdown over the future of the country’s fiscal policy.

“If Biden is reelected and the Trump tax cuts disappear, that’s a 20 percent tax increase,” Steube said on Fox Business’s The Evening Edit. “Right now, small businesses pay about 21 percent in taxes to the federal government. If Trump’s tax cuts disappear, you’re talking 43 percent. It is an increase in taxes by 20 percent, to 43 percent.”

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“We had committee hearings where business people came and said that if those tax cuts expired, they would be forced to lay off their workers, they wouldn’t be able to expand their businesses, which means there will be fewer jobs and less money for Americans are. families. In addition, Biden wants to raise taxes by $7 trillion,” Steube said.

Often referred to as the “Trump tax cuts,” the TCJA was a major overhaul of the U.S. tax code. It lowered the top individual income tax rate from 39.6% to 37%, nearly doubled the standard deduction and lowered the corporate tax rate from 35% to 21%.

Supporters of the law argued that these changes would boost economic growth, boost investment and provide much-needed relief to American taxpayers.

Supporters of the law argue that it has indeed delivered on its promises, citing increased business investment, job creation and a stronger economy.

However, critics argue that the benefits have disproportionately accrued to the wealthy and that the law has contributed to rising budget deficits.

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“This argument from the left that this is just ‘helping the rich’ is a complete lie to the American people. People trust their jobs in these companies,” Steube said.

A critical aspect of the TCJA is that many of its provisions are set to expire at the end of 2025. This means that unless Congress acts to extend or make permanent these tax cuts, millions of Americans could face higher tax bills in the coming years.

During his campaign and now as president, Joe Biden has made it clear that he plans to let the TCJA expire if he is re-elected. The position has drawn criticism from Republicans and some moderate Democrats, who argue that letting the tax cuts expire would harm the economy and middle-class families.

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If the TCJA expires, the consequences could be far-reaching. According to estimates, the average American family of four earning $75,000 could see their tax burden increase by $1,500.

Small businesses would also face a higher tax rate, potentially impacting their competitiveness and profitability. Additionally, the expiration of the cap on the state and local tax deduction (SALT) could provide a significant tax benefit for high earners in certain states.

Biden’s justification for letting the tax cuts expire is based on his belief that the law disproportionately benefited the wealthy and corporations while doing little to support the middle class.

However, critics argue that this stance contradicts his campaign promise not to raise taxes on those making less than $400,000 a year.

The expiration of the TCJA would mean that many taxpayers, including those in the middle class, would face higher tax bills. This could put additional financial pressure on families already struggling with the rising cost of living.

The debate surrounding the SALT deduction limit

One of the more controversial aspects of the TCJA was the $10,000 limit on state and local tax (SALT) deductions. This provision has been a source of controversy, especially in high-tax states.

The SALT deduction debate

Proponents of the SALT deduction cap argue that it helps limit the extent to which the federal government subsidizes state and local tax policies, while critics argue that it unfairly penalizes taxpayers in certain regions.

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The expiration of the salt cap

The SALT deduction cap also expires in 2025, potentially providing a significant tax benefit for high-income earners in high-tax states. These dynamics have added a new layer of complexity to the ongoing debate over the future of the TCJA.

The role of Congress and the legislative process

Ultimately, the fate of the TCJA will be determined by the actions of Congress. Both the House of Representatives and the Senate will play a critical role in shaping the future of the tax code.

The legislative landscape

As the 2024 elections approach, the balance of power in Congress will be a crucial factor in determining the path forward. The ability of both parties to implement their preferred tax policies will depend on the composition of the legislature.

The potential for compromise

Given the partisan divide on this issue, the possibility of a bipartisan compromise that could expand or modify the provisions of the TCJA cannot be ruled out. However, the political landscape and diverging priorities of the two parties could make achieving such an outcome difficult.

The debate over the future of the TCJA goes beyond its immediate impact on taxpayers and the economy. It also raises broader questions about the direction of U.S. tax policy and the government’s role in shaping the country’s fiscal landscape.

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The outcome of the TCJA debate will have implications for the future of tax policy in the United States. It could influence the priorities and approaches of policymakers, as well as the public’s perception of the tax system and the role of government in managing the economy.

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