Cheers to the TCJA!

Back in 2017 the Tax Cuts and Jobs Act enacted a temporary reduction in federal taxes on beer, wine and spirits. Now, as a result of the incredible success of the TCJA, Congress is considering making those cuts permanent.

The TCJA had great impact on all lines of the supply chain of the industry. They allowed everyone from farmers and bottlers to truckers and distributors, a chance to invest and grow, both internationally and on US soil.

According to the Beer Institute, the beer industry provides more than 2.2 million American jobs, generating more than $350 billion in economic output. Overall, the cuts from the TCJA were estimated to save the industry $130 million per year. If these cuts become a permanent feature of tax legislation, the industry can continue to grow, employee more workers and create benefits for communities nationwide.

“As a manufacturer and brewer in the United States, we’re pleased to see the tax break on brewers large and small reintroduced,” said Anheuser-Busch Chief External Affairs Officer Cesar Vargas. 

The beverage industry is just one of many US industries that have thrived under the TCJA. These reforms continue to help businesses, both small and large, which in turn continues to give people across the US a chance to live their American Dream.

Rewarding Employees, Reaching for New Opportunities and U.S. Based Investment: The Effects of the TCJA!

Mission Produce, an avocado distributor based in Oxnard, California, is rewarding employees in response to the ongoing effects of the Tax Cuts and Jobs Cuts Act of 2017. Mission’s President and CEO Steve Barnard said from the outset of the changes he was able to give “all our U.S.-based employees a US$1,000 bonus.” Moreover, Mission said it has been able to implement a new pay scale for their many seasonal employees, increasing hourly wages by up to US$2 an hour as result of increased profit from lower taxes. He said “it’s only fair that we share the benefits that tax reform will have on our business with our valued employees.”

Beyond their employees, Mission is using this extra money to invest in their business and as a result the U.S. economy at large. Barnard stated that he plans to invest the tax savings in new facilities and technology to create opportunities for the company. Tracy Malmos, Mission’s chief people officer added “We are expanding production and distribution facilities across the United States and investing more at home than internationally. We recognize the hard work done by Congress in passing this landmark reform.”

Mission’s story, and thousands more like it, are evidence of the lasting success of the TCJA. These historic tax reforms are changing the lives for Americans across the country and are leading to higher wages, strong businesses and continued investment on our soil.

Thanks to Tax Reform America is Strong, and Still Getting Stronger

For the First time since the Great Recession in 2008 lower-end earners are getting greater benefits than higher-end earners. According to the Bureau of Labor statistics earnings rose by 3.4%, which marked the seventh consecutive month that saw earnings increase by 3% or more. This solid growth across income levels is an excellent indicator that our Economy is thriving. CNBC’s Jeff Cox even said that this wage trend could prove that our economy will be able to maintain the growth seen in 2018.

Our economy is not only prospering domestically, but globally as well. The Tax Cuts and Jobs Act has helped the American economy a force to be reckoned with. Thanks to the reduction of the corporate tax rate the American economy has become the most competitive economy in the world. GDP growth went up 3.1% in 2018, wages grew by 3.4%, and unemployment is at its lowest point in the past 50 years.

Many members of Congress are optimistic about the sustainability of this economic surge, despite the Democrats harping on the shortcomings of the TCJA during this week’s House Ways and Means Committee hearing. Representative Kevin Brady is insistent that this economic growth is not the precursor to a slowdown, disregarding the recent assertion that it is nothing more than a “sugar high”.

Tax reform has offered an incredible boost to our economy. Thanks to the TCJA business is booming, and there is no end in sight.

Tax Reform is Paying Dividends

According to CNBC, job openings are at a record high. The Labor Department claims that the reported 7.3 million open jobs in December was the highest in the past two decades.  If that news wasn’t big enough, the Commerce Department also reports that America’s fourth-quarter GDP increased 2.6%, outperforming original estimates.

The Tax Cuts and Jobs Act (TCJA) has undoubtedly played a major role in improving the economy since the bill was passed in December of 2017. Companies of all sizes are able to hire more employees, provide higher wages and bonuses, and fund improvements to their businesses thanks to the TCJA.

American business owners would like to thank Congress for their efforts in promoting the economic growth. We hope Congress continues to work on behalf of businesses, small and large, to ensure more growth, and protect us from burdensome regulations that would damage this economic prosperity.

This news also comes at a time when some members of Congress are already seeking to raise taxes in order to fund other projects. This would be a harmful misstep that would have massive implications for the business community across the country.  We are starting to reap the benefits of tax reform and to undo it would harm every business in the country.

Rep. Brady Very Bullish On Positive Impacts of Tax Reform

On Monday, April 16—the day before Tax Day—House Ways and Means Committee Chairman (and architect of the Tax Cuts and Jobs Act) Rep. Kevin Brady (R-TX) penned an excellent piece in USA Today about Americans filing their taxes for the last time under the previous, anti-growth tax code.

In the piece, Brady writes that on Tuesday, April 17, “we Americans file our taxes—for the last time—under the old, broken tax code…Goodbye and good riddance to that outdated, monstrosity of a tax code that took too much of your money, sent our American jobs overseas, and kept our economy so slow many workers didn’t see a pay raise for a decade or more.”

Brady says that, going forward, Americans “should all take comfort knowing that this time next year they’ll file under the new, modern tax code that lowers taxes for families and local businesses—and leapfrogs America to the lead pack among the world’s tax codes.”

What does this mean for you and me? Well, “starting now, individuals and married couples will keep more of their hard-earned money and take home a bigger paycheck,” in the form of “lower tax rates across the board and a standard deduction that has been nearly doubled.” A typical family of four earning the median annual income of $73,000 can expect to see a “total tax cut of $2,059.” And “for a newlywed couple earning $61,000 or less, they won’t pay a cent in federal income tax.”

Brady adds that, under the new tax code, we’re “already seeing more jobs, larger paychecks and new investments in the USA—but the best is yet to come” because the new tax code “no longer runs roughshod over hardworking families or Main Street businesses, but instead embodies the principle that Americans know how to spend their own money better than a bureaucrat sitting in a Washington office.”

“It’s now undeniable that tax reform is boosting the economy, and that American families are already benefiting,” says Brady. “More than 400 companies—and counting—have announced pay raises, bonuses and investments in their workers and businesses,” and “more than 4 million Americans are seeing pay raises and new benefits,” and wages “are growing and unemployment is low—with U.S. jobless claims at their lowest level since 1973.”

Specific to small businesses, Brady says that “thanks to tax reform, we now have lower tax rates for local businesses—including a first-ever small business deduction to protect 20% of their income from taxes.”

This means “small businesses, where almost half of America’s private-sector workforce is employed, will have more money to invest, hire and grow in their community.”

“It should come as no surprise that small business optimism is now at the highest level since 1983,” he adds. No surprise at all!