Tax reform is already paying off for residents of Ohio, Youngstown
Just before the first of the year, President Trump signed the Tax Cuts and Jobs Act into law. Just a few weeks later, we’re already seeing real progress in helping create a better economy and a better future for the people of Youngstown – and families across Ohio.
Whether through expanding investments in plants and equipment, raising wages, distributing bonuses, or increasing 401(k) matches, workers are benefiting from businesses reinvesting in their employees from the savings in this new law – and that will only continue.
I was heavily involved in developing this tax reform legislation, serving on the Senate tax-writing committee and on the House-Senate conference that negotiated the final bill. We crafted this bill with two goals in mind: middle-class tax cuts and business tax reform to help workers, businesses, and our economy. The idea is to stop jobs and investments from going overseas and instead create more opportunity here in America.
On the middle-class tax cuts, the proof will be in the paycheck. Just recently, the IRS updated its tax-withholding charts for employee paychecks to reflect the new law. Every middle-class income group receives a tax cut, and the Treasury Department predicts 90 percent of Americans will get a tax cut. That is real money staying in your pockets rather than going to Washington.
The tax cuts are mostly a result of lower tax rates, doubling the standard deduction to $24,000 per family, and doubling the child tax credit to $2,000 per child.
One result of these tax cuts is that more than 3 million Americans who have federal income tax liability will come off the tax rolls altogether. The median- income family in Ohio can expect to save about $2,000 a year as a result of these tax cuts.
For decades, expenses have gone up, health care being the biggest, and wages have been flat – that’s the middle-class squeeze. Most Ohioans live paycheck to paycheck, and that extra $2,000 of hard-earned money can make a big difference to help make a car payment, take a much-needed family vacation or save for retirement.
Over and above the additional savings from middle-class tax cuts, Ohio workers are benefitting from the business tax reforms in this law. Lower tax rates and immediate expensing for new equipment is why more than 160 companies across the country have announced new investments in their workers or businesses because of tax reform savings. I recently visited Tremco, a Cleveland manufacturing company that is investing in new equipment, hiring new workers, and increasing contributions to employee retirement plans.
Just the beginning
More Ohio businesses such as Fifth Third Bank, Nationwide Insurance, Western & Southern Financial Group and more have announced increased wages, bonuses, or benefits. And Walmart, Ohio’s largest employer with more than 50,000 workers in our state, announced it will increase all three as a result of this historic tax reform. The results are there for Youngstown workers and Ohio businesses – they aren’t hypothetical – and this is just the beginning.
We are making American businesses small and large more competitive by lowering our business tax rate. No longer do American companies pay the highest tax rate in the industrialized world, and the result helps our workers and businesses compete in the global market. We also updated our international tax code to encourage jobs and investments in this country, rather than overseas. We want the trillions of dollars of foreign profits that are stuck overseas reinvested in America, and this tax reform helps achieve that.
As we developed this bill, I fought for the interests of Ohioans and our communities. I helped successfully preserve key tax incentives like the New Markets Tax Credit, which is extremely important to Youngstown and helped provide funds to renovate the downtown Youngstown YMCA. This was an amazing project that I see the benefit of every time I’m in Youngstown. I also worked to protect the Historic Tax Credit, which helped leverage funds for the new DoubleTree hotel in downtown Youngstown and will encourage more economic development in the area. These provisions were removed in an earlier version of the tax reform bill, and I worked to ensure they made it into the final law.
It was 31 years since we last updated our tax code in a comprehensive way. This new tax reform law updates our economy for the 21st century and provides relief for middle-class families.
We have reopened our economy as the best place in the world to do business – and Ohio workers, families, and communities like Youngstown – and others across the state – benefit from that.
Republican Rob Portman has represented Ohio in the U.S. Senate since 2011.