The President is Right to Preserve Tax Cuts to Protect US Businesses, Working Families

Financial markets are whipsawing surrounding the president’s ongoing efforts to right-size America’s trade imbalances through tariffs. It’s a noble goal if the result yields greater prosperity and a reduction in global tariffs and other non-tariff barriers.

However, the issue is presenting a great deal of uncertainty for businesses of all sizes that may be concerned about the short- and medium-term impacts on the supply chain and operations. In the meantime, Congress should deliver the best type of certainty they can in this moment: an extension of President Trump’s Tax Cuts and Jobs Act.

During my time in the House Freedom Caucus and throughout my political career, I’ve always focused on reducing the scope of government and supporting policies that allow Americans to keep more of what they earn. In the three decades since President Reagan, comprehensive tax reform was always the White Whale – a major conservative objective that always proved elusive.

That changed in 2017 when President Trump demanded a major tax cut package. In his recent address to Congress, he called for them to re-enact the law and go even further, such as allowing for the full deduction of businesses expenses.

When Congress passed the Tax Cuts and Jobs Act in 2017, it marked a generational and milestone moment for America. The TCJA made sweeping, long-overdue changes to the U.S. tax code, lowering tax rates for individuals and businesses, increasing the Child Tax Credit (CTC), and nearly doubling the standard deduction. Importantly, the law lowered the corporate income tax rate from a prohibitively high 35% to a leaner, much more competitive 21%, putting U.S. businesses more in line with their global counterparts from a tax perspective.

The biggest mistake Republicans made with passage of TCJA was waiting until the last month of President Trump’s first year in office to fulfill his campaign promise of lowering taxes. That gave Democrats all the ammunition they needed during the 2018 midterm elections to win back the House.

I’m happy to see that President Trump and many Republicans have learned the important lesson of timing and are working to quickly extend these important tax provisions well before the December 31^st expiration date. This shows they are listening to the American voters who asked for tax certainty right away.

I understand the concerns that many have raised about federal spending. During my time in Congress, I was repeatedly a thorn in leadership’s side when it came to spending bills that I felt didn’t do enough to curb spending. In fact, I lost my seat in Congress because of it. But unlike my time in Congress, we have a President who is not just paying lip service to the need to reign in wasteful spending, he is actually doing it. Thanks to DOGE, the Trump Administration is doing more to reduce the size and scope of the federal government than ever before.

While President Trump is keeping his promise on spending, it’s incumbent on Republicans in the House and Senate to help him keep his promise to extend TCJA and prevent tax increases on American families, small businesses, and workers.

The 2017 tax law went on to be among the most popular and effective policies of Trump’s first term. The tax cuts and changes it made have spurred economic activity, supercharged business growth and expansion, enhanced worker pay, and energized the economy.

These critical reforms have helped America grow and maintain the strongest economy in the history of the world. In fact, a study from economists with the National Bureau of Economic Research and the U.S. Treasury department found that the 2017 tax law “substantially raised U.S. capital investment and boosted economic growth.” For American workers, wages grew exponentially under the TCJA, increasing by 4.9% for the “fastest two-year growth in real wages in two decades.”

The TCJA’s lower rates, CTC expansion, and near-doubling of the standard deduction have all helped working Americans keep more of—and do more with—their hard-earned money. In fact, the “biggest beneficiaries” of the Trump tax cuts have been “working and middle-income” Americans, despite claims to the contrary from critics. According to IRS tax data, filers with an adjusted gross income (AGI) of $15,000 to $50,000 saw an average tax cut of 16% to 18% in the first year of the TCJA, with average cuts decreasing as income increased.

Now, however, several of the tax cuts and provisions—including the individual tax provisions—are set to expire at the end of the year. If that happens, then most taxpayers and businesses nationwide will see massive tax increases in 2026.

President Trump has promised to extend and strengthen the TCJA and to continue working to lower the corporate tax rate. With a new term underway, and Republicans controlling both the Senate and House of Representatives, Congress must move swiftly to follow through on this promise.

Failure to secure and protect these critical tax cuts would all but ensure most Americans would face a major tax increase next year and could wind up costing Republicans one or both of their majorities in 2026.

But the reasons for moving quickly aren’t purely political. Failing to extend the cuts soon could have big impacts on tax filers and businesses who are trying to plan for their future.

We can’t keep taxing Americans to solve Washington’s fiscal problems. Ultimately, our government has a spending problem, not a lack of hard-earned taxpayer revenue. Lawmakers should address that problem immediately and focus on keeping taxes on U.S. businesses and working families low. Ultimately, extending the TCJA is the smartest, most effective way to do that.

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Tim Huelskamp was a member of the U.S. House of Representatives from 2011 to 2017, where he represented Kansas’s 1^st congressional district.