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Grassley at Hearing on President Trump’s Proposed 2021 Budget, Secretary Mnuchin Testimony

February 12,2020

Prepared Opening
Statement by U.S. Senator Chuck Grassley of Iowa

Chairman, Senate Finance
Committee

Hearing on the
President’s Fiscal year 2021 Budget

Wednesday, February 12,
2020

We are
pleased to have Treasury Secretary Mnuchin here today to testify on the
President’s Fiscal Year 2021 budget proposal.

The
President’s budget includes proposals to confront a number of important policy
issues. I look forward to working with the President, the Secretary and others
in the Congress to address these and other pressing issues in the Committee’s
jurisdiction. Drug pricing and the multiemployer pension crisis are two such
issues.

This budget
proposal comes at a time when the economy is strong, especially for working
American families.  Better trade deals, less regulation, and lower taxes
from tax reform have translated into wage increases, especially for lower-wage
earners and historically tight labor markets.

Over 6.7
million jobs have been created since President Trump was elected, with nearly
70 percent of the job gains occurring since we passed the Tax Cuts and Jobs
Act.

Unemployment
has fallen to a 50-year low. We’ve had 23 consecutive months with the
unemployment rate at or below 4 percent, the longest streak in nearly five
decades. Unemployment for Hispanic and for African American workers have set
all-time record lows.

America’s
middle class is growing and families are benefitting, with a family of four
earning $73,000 seeing their tax bill cut by over $2,000 after tax reform.

Statistics
like these show that tax reform is a success. The Treasury Department’s work to
implement the new tax law as we intended has been an important part of that
success.

We
appreciate the diligence and dedication Treasury and IRS have maintained over
the last 18 months to release extensive guidance necessary for hardworking
Americans and the business community to file their tax returns.

Despite
Treasury’s steadfast efforts, however, the critics have continued their assault
on the Department for doing its job – criticism that is unfounded.

While
Treasury plays an integral role when any major tax legislation is enacted, the
heavy lifting occurs when the new legislation is implemented. Treasury is
following the same process set out in the Administrative Procedures Act
that has occurred after enactment of other tax legislation, like the Affordable
Care Act.

Critics
continuously use preliminary and incomplete data to distort the effects of tax
reform to support their political narrative. Their focus on revised CBO
projections of corporate tax receipts is just the latest installment as I
discussed in my statement yesterday on the Senate floor.

Similarly,
we all recall the misinformation campaign in last year’s filing season when
critics tried to persuade the public that tax reform was a failure because
early tax refunds were down. Of course, they conveniently ignored that the size
of a tax refund says nothing about the tax liability of an individual or
family. In the end, the criticism proved to be flat-out wrong. Americans got
tax relief, and the average size and number of refunds ended up being closely
in line with previous years.

I’m hopeful
that we can avoid similar scare tactics in this year’s filing season. Nothing
the critics can say will refute the fact that every income group in every state
saw a tax cut under tax reform, or the fact that this is particularly true for
low and middle-income families.

Instead, I
hope we can work together on policies that will benefit all Americans,
including some in the President’s budget proposal.

We have a
solid foundation of bipartisan accomplishments in recent months, including the SECURE
Act, the Taxpayer First Act, and the USMCA trade deal.

And, after
extensive negotiations, we came together to extend a number of temporary
bipartisan tax provisions. I wish more could have been done to resolve them
once and for all, as we did in repealing three onerous Affordable Care Act
health taxes. But hopefully our efforts in December can lead us to success in
future discussions on the expiring provisions that are coming up at the end of
this year.

I’m also
encouraged by the progress that has been made at the OECD to reach a
multilateral global tax agreement on the digital economy. Senator Wyden and I
have remained united and bipartisan in our message that unilateral measures
that discriminate against American companies cannot be tolerated, and we
continue to support Treasury in these negotiations.

As this
year progresses, we should build upon these past successes to make sure
Treasury and our tax laws are working for the American people. 

I’ve seen administration budget proposals from Republican and
Democrat presidents alike. No matter which party controls the White House,
members won’t support everything that they see. As a matter of fact, one of
former president Obama’s last budgets was defeated on a 99-0 vote.

As I’ve
said before: in our system, the president proposes and the Congress disposes.
Even so, today’s hearing is part of the important process of looking for things
that people on both sides can agree on to support the American people in the
most fiscally responsible way. 

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