Northeast South Dakota News

U.S. Senate Majority Leader John Thune (R-S.D.) spoke on the Senate floor about the impact of recent Republican-led tax reforms included in the One Big Beautiful Bill. Thune emphasized that the new measures provide tax relief to Americans across every county in the United States.

“Americans in every county in America will see tax relief from this bill,” Thune said. He noted that while a recent report highlighted these benefits, Republicans had anticipated this outcome when drafting the legislation.

Thune compared the current legislation to the 2017 Tax Cuts and Jobs Act, which also reduced taxes for all income levels, with working Americans receiving a significant proportional benefit. He stated that this year’s bill makes those earlier cuts permanent.

According to Thune, without congressional action, several provisions were set to expire this year. For example, he explained that a typical family earning $80,000 would have seen its tax rate increase from 12 percent to 15 percent next year and lost other benefits such as an increased standard deduction and child tax credit. The standard deduction would have been nearly halved, and the child tax credit would have dropped from $2,000 per child to $1,000 per child.

“For people in my state, that would’ve meant paying an average $2,500 more in taxes next year,” Thune said.

He outlined several permanent changes made by the bill: lower tax rates; an increased and inflation-linked child tax credit now at $2,200 per child; a higher standard deduction; a new $6,000 bonus deduction for seniors; elimination of taxes on tips; and removal of taxes on overtime pay.

“These reforms make for a tax code that works for working people,” Thune said. He added that eliminating taxes on tips would help millions who earn part of their income through tipping—including service workers and drivers—while removing overtime pay taxes benefits professions like police officers and nurses.

The bill also includes support for self-employed individuals such as small business owners, farmers, and ranchers by making permanent lower rates and deductions like section 199A for pass-through businesses. “These provisions free up cash that will allow family farms and ranches and small businesses to invest in their operations and their workers,” Thune stated.

Investment incentives are also part of the reform package. Permanent bonus depreciation allows immediate expensing for equipment purchases or improvements by farmers or manufacturers. Immediate expensing for research and development is now permanent as well.

Additionally, raising the exemption threshold for estate taxes aims to protect more family businesses from having to sell assets due to inheritance costs. “It means Americans who have worked their entire lives building up their dream won’t have to worry about that dream being sold off or dismantled to settle a tax bill when they pass it on to the next generation,” Thune said.

Thune concluded his remarks by stating: “With the working families tax reform Republicans enacted this year, America’s tax code is now permanently oriented toward supporting hardworking Americans.”