Motion to Discharge

Floor Speech

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Mr. GRASSLEY. Mr. President, in 2017, Republicans reformed the Tax Code in a traditional sense. We broadened the tax base by reducing tax preferences for special interests in favor of lower overall tax rates.

We also had several other goals, including maintaining the progressivity of the Tax Code, cutting taxes across all income groups-- predominantly for the middle class--and making our business tax system globally competitive. We were able to accomplish each of these goals in that 2017 tax bill.

On average, taxpayers across all levels saw a tax cut. Middle-income taxpayers saw the largest percentage decrease in their tax bills. Also, we not only maintained the progressivity of our Tax Code, we made it more progressive.

Moreover, the bill brought our business tax system and rates in line with the rest of the world. You just heard Senator Sasse speak brilliantly about that point. It put an end to the practice of corporations moving headquarters offshore to avoid paying the highest tax rate in the developed world.

In the process, it incentivized American businesses to invest here at home and made America a more attractive place for foreign companies to locate.

Now, prepandemic, these reforms resulted in the highest economic growth, the lowest unemployment, and the biggest wage gains that we had seen in decades. So when you talk about what the Democrats are proposing through reconciliation, it is kind of like they are ready to kill the goose that laid the golden egg.

Now we are post-COVID. Democrats assert a massive expansion of government is necessary to, in their words, build back better. But that is exactly backwards. America will build back better post-pandemic, but it won't be because of the government. In fact, it is already happening due to the perseverance of the American people and the ingenuity of the American entrepreneurs and job creators.

Unfortunately, the tax bill unveiled by Ways and Means last week will only hinder our path back to the prosperity that we had prior to February 2020. Their bill is the exact opposite of tax reform. It would raise marginal tax rates on individuals and small businesses to a level not seen since before the 1986 tax act.

Moreover, our corporate tax rate would once again be the highest among our major trading partners. These tax hikes will slow our recovery from the pandemic, and it will reduce capital investment; and it takes capital investment to create jobs. So it will result in fewer jobs, and it is also going to result in reduced wages beyond the reduced wages that is already happening because inflation is heating up. It will reinvigorate corporate inversions with major companies fleeing overseas.

In conjunction with raising tax rates, they narrow the tax rate base in favor of social and corporate welfare handouts. Now, I say handouts because the majority of their bill's $1.2 trillion in tax cuts aren't reductions but turn out to be pure spending.

According to the Joint Committee on Taxation, $689 billion--or 57 percent--of their so-called tax cuts are actually outlays. That is a fancy way of saying Treasury is going to write the individual or businesses a check that may exceed their taxes that they had otherwise paid.

This is turning our tax laws and the mission of the Internal Revenue Service on its head. No longer would the Tax Code primarily be raising revenue necessary to fund essential governments. In fact, it would be about doling out cash to those that Democrats consider worthy.

Given their rhetoric, you might think that these types of cash payments would be reserved for low- to moderate-income individuals and families. But, even very wealthy individuals buying electric cars, millionaires investing in green energy projects, and multibillion- dollar corporations will be in line for Federal checks.

This is astonishing coming from a party claiming to be outraged by wealthy individuals and profitable corporations paying zero tax. As recently as March of this year, President Biden castigated Amazon for not paying ``a single solitary penny in federal income tax[es].'' If he finds that unacceptable, then he should be beside himself about this Democrat tax proposal.

Under their tax bills, a company such as Amazon would have an effective tax rate of not just zero, but negative. In other words, favored companies could receive a check from the government in excess of any income taxes owed. Meanwhile, disfavored groups would be left to pick up the tab. This includes Iowa family farmers, who could see their years of hard work taxed away as a result of the death tax exemption being slashed in half.

What I have outlined here is a small sample of concerns that I have with the House proposal. Their bill is so chock-full of tax giveaways, counterproductive tax policies, and punitive tax hikes that one former Democrat Senate staffer is quoted in the publication of POLITICO calling the House approach--in that person's words--``laughable.''

I hope my Senate colleagues do better. It will be hard for them to do any worse.

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