How to Build on Trump’s Tax Success

The expiration of Trump’s tax cuts next year gives Congress the chance to write an even more pro-growth code

By Kevin Brady and Douglas Holtz-Eakin. Excerpts:

"From 1960 to 2000, per capita gross domestic product rose 2.3% annually. Since then, it has downshifted to 1.4%."

"On average the TCJA [The 2017 Tax Cuts and Jobs Act] stimulated U.S. investment by 20%. Every $1 cut in corporate taxes increases economic production by an estimated 44 cents. Workers saw a 9% increase in inflation-adjusted earnings between Jan. 1, 2018, and Dec. 31, 2020—the fastest growth since the government began publishing data in 1979."

"They created Section 199A—or what they called the 20 Percent Small Business Tax Deduction—which allows pass-through owners to deduct 20% of their business’s income. This deduction reduced the effective tax rate to 80% of the statutory tax rate, supported 2.6 million jobs, raised employee compensation by $161 billion and added $325 billion to output."