SALT LAKE CITY — Sen. Orrin Hatch unveiled his plan Thursday to overhaul the nation's tax system, saying it could save middle-class families as much as $1,500 a year.
The Utah Republican said his Tax Cuts and Jobs Act would bring the outdated tax code into the 21st century and provide tax relief for hardworking people and small businesses. He said it would "unleash" the American economy, leading to more jobs, higher wages and greater investment at home.
Passing tax reform is more important now than ever, and the cost of doing nothing would be too much for Americans to bear, said Hatch, the chairman of the Senate Finance Committee.
"We have an historic opportunity to help, and that opportunity should not be squandered by anyone on either side of the aisle for cheap political points," he said on the Senate floor.
The measure includes a one-year delay in lowering the corporate tax rate, which would be cut from 35 percent to 20 percent. The White House and some Senate Republicans oppose the delay.
The proposal aligns with a tax reform framework the Finance Committee, the House Ways and Means Committee and Trump administration released in September that they say would broaden the tax base, close loopholes and grow the economy.
Estimates show the bill could save a family of four up to $1,500 a year, according to Hatch.
"Now, after nearly a decade of stagnant wages and sluggish economic growth, we finally have a president who is serious about working to ensure that we have a tax code that actually works for the American people," the senator said.
Hatch said he's confident the Senate and the House can produce a pro-growth tax reform package that provides relief for taxpayers.
But he acknowledged that Democratic election victories this week might complicate the tax reform push, according to the Washington Post.
“I mean, it could, because the elections went against the Republicans,” Hatch said Wednesday.
Asked whether he is feeling pressure to tilt the tax plan’s benefits more toward the middle class, Hatch said, “I think we’ve been moving that way anyway.”
Hatch's plan lowers individual tax rates for low- and middle-income people by expanding the zero tax bracket and maintaining a 10 percent bracket, which he says would let taxpayers keep more money, make ends meet and save for retirement.
The bill would nearly double the standard deduction for individuals, married couples and single parents. It keeps the deduction for charitable contributions. It would also expand the child tax credit from $1,000 to $1,650.
Increasing the child tax credit is key to Utah GOP Sen. Mike Lee getting on board with any tax plan.
But he and Sen. Marco Rubio, R-Fla., say Hatch's proposal isn't enough. They say the best way to provide relief for working families is to expand the child tax credit to $2,00039 comments on this story
"The Senate is not going to pass a bill that isn’t clearly pro-family, so we look forward to working with our colleagues to get there," Lee and Rubio said in a joint statement.
Also Thursday, Politico reported that a new version of the House Republican tax overhaul bill does not include a repeal of the Obamacare individual mandate. President Donald Trump has pressed for the provision as a way to undo the Affordable Care Act and to help pay for tax cuts.
But an amendment released by House Ways and Means Chairman Kevin Brady, R-Texas, does not include it, nor does the Senate bill.