The Trump Administration achieved one of its top legislative goals by helping to pass the first comprehensive tax reform legislation in over 30 years. The Tax Cuts & Jobs Act delivers tax cuts to middle-income families and makes American businesses more competitive. Treasury played a critical role in developing this legislation, and is now working to implement it.
Secretary Mnuchin worked with Members of Congress throughout the legislative process to develop and refine a plan to cut taxes for hardworking Americans and their families. The Tax Cuts & Jobs Act doubles the standard deduction taken by most taxpayers so that the first $24,000 of earnings for families and $12,000 for individuals are tax free, referred to as the “zero bracket.” Among other efforts, the legislation also expands the Child Tax Credit to provide additional relief to working families.
In addition to cutting taxes, the legislation simplifies the tax code to make it fairer by eliminating many special interest loopholes, which benefit the well-connected at the expense of everyday Americans. Under the Tax Cuts & Jobs Act, most taxpayers will be able to file their taxes on a single sheet of paper.
Tax reform is also about making American business rates more competitive so that companies will create jobs, increase wages, and invest here in America. That is why the Tax Cuts & Jobs Act moves the United States from the “Offshoring Model,” which has been harmful to American workers and families, to the “American Model.” The legislation cuts the tax rate on C-Corporations from 35% to 21%, to level the playing field that currently favors other industrialized countries. It also helps small and family-owned businesses—which are the engines of job creation in America—by cutting rates for pass-through entities like LLCs, partnerships, and sole-proprietorships.
Secretary Mnuchin and his team have met with hardworking Americans and business leaders across the country to discuss these policies. Treasury will continue working with Congress to implement these reforms to provide relief to American families and make America’s businesses more competitive.