Tax and Fiscal Policy Economic Benefits of Tax Reform

The Congress and the President have delivered on significant investment in the United States increased wages and jobs, and economic growth. It’s now up to business to innovate and invest in workers to help our economy achieve its potential. The opportunity is great.

Mark Weinberger - Chairman and CEO, EY

The recent tax reform law was the biggest change to the U.S. tax system in 31 years. It lowered taxes on individuals and businesses, modernized the way international operations are taxed, and created powerful new incentives for investment in the United States. The reaction from corporations was immediate and positive, with dozens of companies announcing investments in their workforce and expansions of U.S.-based projects.

The full economic effects of pro-growth tax reform will likely take years to play out, as companies increase their investments in U.S. projects, technologies, and workers in the months and years to come.

Tax reform supports long-term economic growth in three key ways:

Lower corporate and small business tax rates will lead to increased investment, higher wages, and more jobs.
Allowing an immediate deduction for tangible property will incentivize businesses to invest in new machinery and equipment and lead to higher growth and productivity.
Embracing a modern, territorial-type system of international taxation will make American companies more competitive and eliminate the lock-out effect that kept foreign earnings trapped overseas.

These three policies combine to help minimize tax considerations as an impediment to investing in the United States. A more competitive tax code increases the likelihood that new investments will be located in the United States, creating jobs, growth, new local tax revenue.

Tax Reform is Helping America Grow

Real impact for workers, families and communities.

What They're Saying

To date, Business Roundtable member companies alone have delivered:

$1.4 billion in charitable contributions, Bonuses, wage increases or larger benefits for 2.2 million workers, Nearly $2 billion in employee bonuses to over 1.1 million employees

CNBC: “Tax code driving business spending.”

“The new tax law is delivering big benefits” to businesses of all sizes who are using the savings to invest more in their companies and increase wages for workers.

Tax Reform Delivers for American Manufacturing

Companies are announcing new manufacturing jobs and facilities that will revitalize American competitiveness.

Tax Reform Delivers for American Families.

Business Roundtable companies have contributed $7.3 billion to pension funds for 2018, helping American families build toward a comfortable and secure retirement.

Bloomberg: “Martinrea International Inc. … Canada’s third largest auto-parts supplier… ran the numbers and they added up to a no brainer.

The new technical center would be built across the border in Michigan, not in its home province of Ontario..[W]hat threw the competitive challenges into stark relief were the U.S. tax changes…”

Tax Reform Delivers for American Workers.

Companies are announcing major investments that will provide better job opportunities and bigger paychecks for American workers.

In the long run, a competitive international tax system is what you have to have…

"As I look and talk to so many of our clients, what does matter is how they feel about the whole economic environment, of which tax reform is a part… I do see clients taking what I would call fairly big strategic projects they have not taken for a while.”

-Ginni Rometty, Chairman, President and CEO, IBM Corporation