Northeast South Dakota News

U.S. Senate Majority Leader John Thune addressed the Senate floor today, emphasizing the importance of making permanent the tax relief measures initially introduced in the 2017 Tax Cuts and Jobs Act. According to Thune, these measures include reduced tax rates for all income brackets, a doubled child tax credit, and an increased standard deduction.

Thune warned that without action, these provisions are set to expire at the end of this year, leading to significant tax increases for American families starting in 2026. He stated that "Americans making less than $400,000 a year would face a $2.6 trillion tax hike," which could mean an additional $1,700 in taxes for a typical family of four earning $80,000 annually.

The proposed legislation aims not only to extend but also make permanent these benefits. "We are making the lower tax rates, and the doubled child tax credit, and the increased standard deduction permanent," Thune said.

In addition to extending individual benefits, Thune highlighted efforts to support businesses by permanently lowering tax rates for small and medium-sized enterprises and enhancing deductions like Section 199A. The legislation also includes provisions intended to boost domestic manufacturing through full expensing for new factories.

Thune cited positive economic outcomes following the original Tax Cuts and Jobs Act as evidence of its success: "In the wake of the Tax Cuts and Jobs Act, our economy grew at a substantially better rate than projected."

Further economic growth is anticipated from these legislative changes. The Council of Economic Advisers predicts long-term GDP growth between 2.9 percent and 3.5 percent due to this bill.

Additional proposals within this legislation include suspending taxes on tips for tipped workers and on overtime for hourly workers. It also proposes suspending taxes on auto loan interest for new cars manufactured in the U.S., increasing deductions for seniors' retirement savings, and creating savings accounts with initial deposits for newborns.

Thune concluded by thanking Chairman Crapo and members of the Senate Finance Committee for their work on this bill's tax components: "I look forward...to delivering permanent tax relief for hardworking Americans – and American businesses – in the very near future."