As an organization with a long history of advocating for working families, we are pleased to see that Congress is on the verge of passing comprehensive tax reform legislation. Reform is long overdue and will benefit all Americans.
With Senate and House leadership negotiating what will ultimately be included in a final tax reform package, we urge them to take the best aspects of each of their bills to create a pro-investment environment where businesses can grow, innovation can flourish, and more Americans can get and keep good paying jobs. The future economic prosperity of American families – especially the middle class – depends on it.
To help accelerate economic growth across the country, it is critical for the GOP leadership to lower the corporate tax rate as they are proposing and preserve interest deductibility. Doing so will create the right incentives for U.S. corporations to invest the billions of dollars in new investments needed to create more jobs and improve America’s infrastructure.
We are encouraged that the Senate and House both recognize the importance of lowering the corporate tax rate to around 20 percent. With respect to interest deductibility, both chambers rightly adopted “thin cap” approaches to maintaining interest deductibility, but with some differences. And those differences will have a significant impact on economic growth. The House approach provides companies with maximum flexibility to deduct interest on loans used to finance capital projects. This will allow more investment, more innovation, and create more jobs.
Getting tax reform policy right for interest deductibility is critical, especially for much-needed infrastructure improvements and expansions in this country. For example, the ability of companies to deduct interest paid on debt is what has helped broadband service providers make the multi-billion-dollar investments necessary to create and maintain today’s robust U.S. broadband ecosystem.
To support continued expansion of broadband infrastructure and spur economic growth across the country, it is going to require significant future investment in next-generation broadband networks and technology. Accordingly, providing incentives for companies to invest new money in future capital projects, particularly broadband service providers, is critical to help ensure America’s global competitiveness for years to come, to create millions of good-paying U.S. jobs, to help companies – large and small alike – grow their businesses, and to provide more Americans with access to the Internet.
Moreover, access to high-speed broadband is a key component to strengthening the U.S. economy and making sure our children have access to a quality education that will enable them to compete for jobs in their field of study and succeed in a modern U.S. workforce. High-speed broadband is the lifeblood to unleashing innovation in numerous industry sectors across the broadband supply chain and creating a better life for all Americans.
Both the Senate and House have advanced extraordinary reform proposals, and we strongly support the bill. On the important issue of interest deductibility, however, we believe the House bill strikes a better balance and will not inhibit investment in capital projects unnecessarily, thereby spurring investment in ultra-fast broadband networks, as well as our roads and bridges, and energy grid and waterways, while contributing greatly to economic growth. This will improve commerce and help America’s working families build successful lives with jobs rooted in their local communities.
We’re excited about tax reform and what it means for the American economy. It takes bold leadership and a strong will to turn big policy ideas into reality. Thankfully, the Republican Congress is close to doing just that.
We urge both chambers of Congress to come to an agreement and pass a comprehensive tax reform package that President Trump can support and sign into law. Now is the time to get this done. America’s working families are counting on it.