Comprehensive package will reignite American economy

Thanks, in large part, to President Joe Biden’s tax-and-spend policies, the state of the American economy is bleak. Wasteful government spending fueled the worst inflation crisis in more than forty years, small business optimism has plummeted, interest rates on everything from home mortgages to car loans continue their devastating trajectory upwards, and the cost of farm inputs remains historically high. Left unresolved, these economic challenges will spell disaster for American prosperity, productivity, and competitiveness.

As a member of the House Ways and Means Committee, I have worked with my colleagues over the last several months to assemble a comprehensive economic and jobs package – the American Families and Jobs Act – that will reignite the American economy, deliver much-needed tax cuts for our families, and cut red tape that burdens our small businesses. When I came to Congress, I promised to be a strong voice for our families, farmers, main street businesses, and rural communities. This legislation will deliver relief, support, and opportunity for each of these four pillars that make rural Iowa the best place to call home.

First and foremost, this package benefits our families. In addition to the enhanced standard deduction – which was raised from $6,500 to $12,000 for individual filers and from $13,000 to $24,000 for joint filers as part of the Tax Cuts and Jobs Act of 2017 – this legislation provides a new $4,000 guaranteed deduction bonus over the next two years that will help Iowa families keep more of their hard-earned money and weather the costly impact of inflation. Dubbed the Tax Cuts for Working Families Act, this bill builds upon the success of the enhanced standard deduction – whose reauthorization I strongly support – and keeps the IRS out of Iowans’ bank accounts. This policy blueprint also includes provisions to repeal the superfund tax on petroleum, which – coupled with attempts to curtail domestic energy production – has significantly increased gas prices. By eliminating this unnecessary tax, Iowa families will see lower prices at the pump, alongside homegrown E-15, and save more money in their wallets.

Second, the American Families and Jobs Act will support our agricultural community and especially help new and beginning farmers purchase the equipment they need to start their businesses and succeed. More specifically, this legislation will allow immediate expensing for purchases – like precision agriculture tools, machinery, tractors, combines, and more – of up to $2.5 million. By expanding immediate expensing, small businesses owners and family farmers will be able to invest more back into their businesses, and ultimately expand their operations, hire new employees, and increase wages. I am also encouraged that this legislative playbook includes language to deter foreign acquisition of American farmland, particularly at the hands of the Chinese Communist Party. Like Iowans already know and I firmly believe, Iowa farmland belongs to the Iowa farmer.

Third, small businesses will enjoy several pro-growth provisions because of this package. Primarily, as we heard from small business owners in field hearings in West Virginia, Oklahoma, and Georgia, making immediate research and development expensing permanent – which lapsed at the conclusion of 2021 – would help continue American leadership in innovation and allow our small businesses to lessen their tax burden and reinvest those proceeds in their operations and workforce. This is particularly important for our manufacturers, biofuels producers, and agriculture community that dedicate significant dollars towards innovation and research to advance their competitiveness, lower their operating costs, and make their businesses more productive and profitable. Absent this simple fix, domestic manufacturers would face over $32 billion in new taxes in 2023 alone and our farmers would incur $400 million in higher taxes. Making 100% R&D expensing permanent would also elevate our competitive advantage against China, which provides its manufacturers and small businesses with a 175% R&D expensing deduction. In the same vein, our package also helps small businesses and manufacturers more quickly depreciate their equipment and machinery expenses. Beginning in 2023, job creators can only deduct 80% of the cost of equipment, machinery, and vehicle purchases, which leaves family farmers and main street businesses on the hook for higher taxes. Fortunately, our solution makes 100% bonus depreciation permanent, ensuring that small businesses can grow their operations without burdensome financial penalties.

Finally, our rural communities will reap the benefits of rural opportunity zones enacted by the Rural Opportunity Zone and Investment Act. By applying the same tax provisions enjoyed by urban cities to our rural communities,this legislation takes real steps to attract private investment and encourage robust economic activity in rural communities that have experienced population loss in recent years. Rural opportunity zones seek to reverse this trend, grow our local communities, and keep our families and job creators in Iowa.

Delivering results for our families, farmers, main streets, and rural communities is not just a slogan; it’s personal to me. I know the families and farmers who call rural Iowa home. On my biannual 36 County Tour, I’ve walked the vibrant main streets of every community in every corner of my district. I know that our rural communities share a common appreciation for hard work, helping our neighbors, and building a stronger country for our children and grandchildren. With these values and memories close to my heart, I will always do what’s best for our families and communities in rural Iowa. The American Families and Jobs Act – forged with the best interests of Iowans in mind – reflects my commitment to deliver real results for the good people I am honored to represent in Congress.

This op-ed was originally published in the Northwest Iowa Review on June 28, 2023.