Our nations tax system and relief the tax burden on american taxpayers with the focus on middle class families. Todays markup is the combination of the years long work. Almost every member of our former almost every member has participated in this process. Our former chairman senator max bacchus was engaged in this effort as was his counterpart on the republican side. Ranking member senator widen has done a lot of work on this effort others who have served on this committee, and moej t most of those who are now on the committee have done a great deal of work to advance tax reform, i want to thank all of my colleagues for their work. I have more to say about members contributions in the coming days, id like to take a few moments to talk about some of the highlights in the bill that will be before us today and this week. This legislation will provide much needed tax relief to American Workers and families. It reduces rates across the board, particularly for those in the middle class, who have struggled to get through the past eight years of economic stag nation it provides substantial benefits for parents and familyies the bill modifies the brackets schedule setting up seven separate tax brackets, the lowest at 10 , and the highest at 38. 5 . Theres also an expanded zero tax bracket, meaning more will see their Tax Liability eliminated entirely. While the unified framework that congressional and administrative leaders released last month, we found the additional brackets help us to better target tax relief to lower income americans and to the middle class even with the additional brackets, the system will be much simpler for the vast majority of taxpayer, the bill nearly doubles the standard deduction up to 12,000 for individuals, 24,000 for married couples and 18,000 for single parents. This as i just mentioned effectively expands the zero tax bracket and reduces the tax burden for millions of families, removing entirely the Tax Liability for many others and eliminating their need to itemize deductions. According to projections, more than 90 of taxpayers will use the standard deduction under this plan. In con taft thats in contrast to around 70 today, which makes the process of computing and filing ones taxes a much simpler proposition. The bill also expands to Child Tax Credit from 1,000 to 1650. And substantially lifts existing income caps on the credit allowing many more parents to claim the credit and giving additional tax relief to middle class families. Under our bill, a family of four making the u. S. Median income of around 73,000 a year will seen their federal income. Tas reduced by 40 . In specific dollar terms, thats a reduction of nearly 1500 nor a single year. Thats about 125 more take home pay for every month for a single parent making 41,000 a year theyll receive a tax cut which cuts their over all Tax Liability by a little more than half thats real money that will help tens of millions of American Families make ends meet simply improve their quality of life. Our bill also preserves the mortgage interest deduction, and the deduction for charitable contributions those are two really important provisions that many support and want to keep in place. Weve also gotten a number of letters and heard statements from many of our democrat he can colleagues urging us to maintain a number of other positions in the code. I received the letter last week urging us to quote existing tax incentives, our bill in accordance with the urging of these colleagues keeps 401 ks and individual retirement accounts fully in place. Others have weighed in on the adoption tax credit or the deduction for medical expenses, both of which are unchanged in this legislation. And weve gotten word from colleagues about their desire to keep the earned income tax credit where it is. Ive only mentioned the individual reforms in the bill. If you look at the policies ive mentioned, you should notice that they represent ideas that both republicans and democrats tend to support. In fact, our Ranking Member introduced legislation a few years back that have significantly brought down individual rates across the board in a fashion similar to the approach outlined in our framework. I might add and nearly tripled the standard deduction. It would have also repealed the alternative minimum tax as would the bill were debating today. In those and other respects that previous legislation is pretty similar to ours. On the business side, our bill willer. Thely lower the Corporate Tax rate to 20 . The current 25 Corporate Tax rate is the highest in the industrialized world. Actually its 35 Corporate Tax rate. Thats the highest in the industrialized world. This is a drag on our economy. One of the few factors continually chasing companies cref Economic Activity offshore. If this idea sounds familiar, it should. Members of both parties for years now have called for lowering the Corporate Tax rate, recognizing by being so out of step with the rest of the industrialized world, we put American Companies, the workers they employ and the customers they serve at a march disadvantage. For example, in this legislation, with former senator coates, senator wyden proposed reducing the Corporate Tax rate to 24 . Two years ago, our Bipartisan Working Group on business tax cochaired by senators cardin and thune said that business taxes should be lower. In fact, that recommendation was the first principle of Business Tax Reform listed in their report to the committee. And the senate as a whole. President obama in one of his later budgets proposed reducing Corporate Tax rates to as low as 25 for certain sectors. And last year, president bill clinton even as his wifes president ial campaign was calling for an increase in Corporate Taxes said we should we should lower our corporate rates. He wanted to lower them to be more on a par with our foreign competitors. We placed a rate at 20 in our bill which is slightly below the current average of oecd countries. Our bill also lowers the burden on Small Businesses through a fairly unique approach. For passthrough businesses whose income is taxed on individual returns, our bill provides a simple Tax Deduction for qualified business income leaving regular compensation to be taxed at the individual rates. The mechanism involved uses existing provisions of the tax code which businesses are accustomed to dealing with and have a large body of precedent behind them. The mechanism provides from policing against anyone thinking about mischaracterization of one form of income as another nrs order to unduly lower their tax bill. Our legislation also expands the availability of cash accounting in order to allow more businesses to simplify their accounting methods. It expands section 179 expensing for Small Businesses in order to help owners invest and expand their businesses so they can increase productivity. And hire more workers. The bill also provides businesses with full and immediate expensing for new equipment. Again, to enhance productivity. Create jobs, and grow wages for American Workers. Finally, the bill modernizes our archaic International Tax system leaving us more toward a territorial tax system. Our current worldwide system is another element of our tax code that chases jobs, Economic Activity, and investment out of the United States. Under this legislation, american multinationals will be able to bring funds from their foreign subsidiaries back into the u. S. Without facing Tax Liability. That means an end to the lockout secretary which in turn means more investment, production, and Economic Growth right here in he ever america which, of course, translates into more jobs and better wages for taxpayers. To provide safeguards, our bill also includes provisions to prevent earnings stripping and other practices that erode our tax base. This is another area where both parties tend 0 agree. In 2015, for example, a Bipartisan Working Group on International Tax reform which was coshared by senator portman and the Current Senate minority leader assessed the problems with the current and International Tax system and recommended change entirely consistent with the ones that were proposing today in this legislation. Long story short, our proposed International Reforms are not just a republican wish list. Theyre some sort of favor to big companies. They are in fact, well within the bipartisan mainstream. All told, the business tax proposals in our bill are designed to grow our economy, increase wages, promote the expansion of businesses, and of course, create jobs. These sections of our bill will modernize our business tax system finally updating it for the 21st century. Thus far, ive only gone over some of the highlights of the bill. Theres more about the bill to discuss which well get to throughout the course of this markup. However, before i conclude, i do want to respond in advance to some of the claims were certain to hear this week about this legislation. There are a number of myths being spread about this bill and what we intend to accomplish. I want to put some of those to bed right now. Friction, im quite certain well hear a lot about supposed process files here today. Well hear that were rushing it and rushing the bill through the committee. And that we havent had enough hearings. Well also likely hear where bills being drafted in secret and democrats being shut out of the process. Let me set the record straight on these points. Under no objective standard is this bill being rushed or forced through. This committee or through either Congressional Chamber as i noted earlier, this committees efforts on tax reform go back years. Let me outline some of the work weve done to lay the groundwork just since i became lead republican on the committee in 2011. In that time span, just short of seven years, weve had about 70 tax hearings, most of which included indepth discussions on ways to improve our code. In the first year, i was joined by all the republicans on the committee in submitting 21 page safz tax reform recommendations to the socalled super committee. This was the start of laying the groundwork. Chairman bachus and i as part of our blank slate approach in 2013 produced ten separate bipartisan options papers discussing concrete policy solutions to fixing our tax code. At the end of 2014, i released an extensive report more than 300 pages long discussing in some detail ideas and principles to be considered during the tax reform debate. The following year, senator wyden and i oversaw the creation of five separate Bipartisan Working Groups, all of whom produced reports which provided the foundation for even more hearings. In other words, weve discussed all of these optics an length. Well also be walking through the bill as part of this markup. Theres quite simply no reasonable basis to claim that more hearings, more discussion and more deliberation have to take place before we can move forward. Virtually every proposal contained in this bill has been the subject of public debate for many years working with colleagues in congress and at administration and after close consultation with committee members, weve put together this chairmans mark. Theres nothing unusual about this process except that with other matters we dont usually spend so many years of study and discussion before putting more concrete proposals together. Furthermore, i have personally invited democrats to participate in this process on a number of occasions. Both publicly and privately. Ive sat in on our committee in front of cameras and microphones and asked colleagues to come to the table with objective minds and without preconditions. Our friends on other side decided it was in their best interests to put some fairly strict preconditions on their involvement. Some of those preconditions did shift a bit over time like the later retracted speeious demand that President Trump release his tax returns before democrats would come to the table. An ultimatum made by key members of the Senate Democratic leadership. But one precondition that never went away was shared by almost every democrat in the senate was the demand that republicans swear off the use of budget reconciliation before any real bipartisan discussions take place. Ef 45 democrats signed a letter in august stating that the public abandonment of budget reconciliation was in their words a prerequisite to any bipartisan ach reform effort. Essentially our colleagues demanded that we empower them to kill any potential tax reform bill. Before they even begin talks. Thats not the kind of statement one usually hears from someone who wants to work in good faith toward shared goals. Its also at odds with the history of the senate. Over the years, the senate has moved many tax bills through reconciliation and in almost all cases, the bills ended up getting votes from both parties. Reconciliation in no way precludes the possibility of bipartisanship and republicans were prepared to follow a similar route with this particular process as was followed in previous tax bills and budget bills. So just everyone is clear, so everyone is clear, it was the democrats own preconditions that kept them from engaging on tax reform. There was an open seat at the negotiating table. They collectively close not to sit on it. Another claim i expect to hear is that our bill is a massive tax cut for the socalled rich. Thats always the claim of democrats. This claim of course, is false. Under the bill, the top rate will be donned by roughly 1 percentage point but the bill repeats a number of tax credits and deductions many of which disproportionately benefit the wealthy meaning that the slightly lower rates will apply to a larger base of income. The joint committee on taxation produced a distribution table than clarifies a number of key points, including the fact that americans at all income categories will receive a tax break under our bill with the middle class getting a larger percentage of the reductions. The joint committee on taxation also found that our bill will not shift the tax burden from the high end on to taxpayers down in lower brackets. In fact, according to jct, those with incomes can of 1 million a year or more will see their share of the overall tax burden go up. So while the bill lowers rates across the board, it actually increases the share of taxes paid by those earning 1 million or more in annual income. Let me just say that again. Our bill increases the share of the overall tax burden paid by millionaires and billionaires. Let me address another jct analysis that includes more good news. Some of my colleagues have latched on to a jct table showing that some percentages of taxpayers in the individual cohorts will see their taxes go up under the bill. I believe the talking point is that 13 million families in the middle class will see their taxes go up next year if the bill becomes law. Lets set aside the fact that it is virtually impossible to create a tax plan that will impact every taxpayer the same way and lets assume for the sake of argument that my colleagues estimates which include virtually no context are correct. Even then the critics of our bill are missing the forest for the trees. They would have the American People believe that he the real story is a relatively small minority of taxpayers could see a slight increase in their taxes with the biggest proportion of overall increases going to upper middle class taxpayers. But to do that, they have to obfuscate the fact that under that same jct analysis, about 90 of those same middle class taxpayers are getting a tax cut at the very least, theyre held harpless under our plan. I know my colleagues prefer to label any republican tax proposal as a massive tax cut for the rich but that is not the case here. Our bill is primarily focused on tax relief for middle and lower income taxpayers. And the analysis by our nonpartisan congressional score keeper has confirmed that the legislation weve crafted accomplishes that goal. Im sure well also hear more about tax breaks for big corporations under the bill. Yet, i would think that anyone who has previously gone on record in support of lowering the Corporate Tax rate will refrain from attacking this bill for doing just that. Of course, i wont hold my breath on that. But if that simple baseline of intellectual honesty were to be observed in this markup, most democrats on this committee would be unable to criticize our effort to lower corporate rates as most of them have endorses a similar approach in the recent past. Im sure well also hear about the death tax today, but i hope with that discussion well get an explanation from some of our democrat colleagues including my friend the Ranking Member why they are so critical of our efforts to simply mitigate the impact of the death tax when they voted in the past to repeal the tax entirely. I also hope stlael an explanation for americas farmers and businesses for why their deaths should be considered a taxable event when they choose to pass their lifes work which has already been taxed at least once already to the next generation. Another matter that well likely hear about this week is the state and local Tax Deduction. Im sure a number of our democratic colleagues will argue that the deduction is an absolute necessity. I plan to ask them, why they want to forego middle class tax relief in order to preserve a Tax Deduction that overwhelmingly benefits the taxpayers at the very high end of the income spectrum particularly after theyve been publicly lamenting the ver