Thank you everyone for coming today to discuss the important topic of tax reform. While Republicans are hiding behind closed doors to formulate how they’re going to cut taxes for the wealthy, we are here inviting the American public to discuss tax reform with us out in the open.
Let me start by reiterating that Democrats support pro-growth, pro-worker, comprehensive tax reform. And let me highlight a few key principles that we believe must be adhered to in tax reform.
For Democrats, our number one priority in tax reform is moving the dial to help middle-class families prosper. That means creating jobs and boosting wages - and giving hardworking, middle-class Americans the relief they need to get ahead.
A key component to this “middle-class first" test is that any tax reform plan must place workers first. The benefits should not skew towards the wealthy. In fact, we believe that the wealthy should not receive any tax cuts in these efforts. Instead, tax reform should be primarily focused on raising the living standards of the middle-class.
Second, any tax reform package that we could support must be fiscally responsible, and at least revenue neutral. And when I say revenue neutral, I mean revenue neutral as determined in a conventional revenue estimate by the Joint Committee on Taxation. We've been hearing a lot of rhetoric these days that "tax cuts pay for themselves." But economists - both conservatives and progressives - tell us that’s just not the case. And one of our witnesses today, Bruce Bartlett, who worked for Ronald Reagan and Jack Kemp, will make that case.
We’ve now all seen the Republicans’ tax framework. And despite the Republicans’ claims that their tax plan is all about the middle-class, it is instead a poorly disguised tax cut for the rich. Yesterday at the White House during our meeting with Ways and Means Committee members, President Trump promised to all of us in that room that under his tax plan, “the rich will not benefit." Well, it only took one day for Speaker Ryan and Leader McConnell to break that promise.
The Republicans lower the top individual rate to 35 percent, eliminate the estate tax and AMT, and create a huge loophole for the wealthy by lowering the pass-through rate to 25 percent. All of this is likely to award huge tax cuts to the wealthy. In fact, one of our witnesses today, Seth Hanlon, has estimated that this amounts to a $220,000 per year tax cut for an average millionaire.
It’s time to move on from the “Big 6" and really get together on a bipartisan basis and negotiate a truly middle-class tax reform package.
I am honored to be joined today by my Democratic House colleagues and Members of our Leadership team. It is now my privilege to recognize the distinguished House Minority Leader, Nancy Pelosi, for an opening statement.
