This article first appered in Tribune Star.
Two members of Indiana’s congressional delegation are optimistic tax reform legislation will be enacted before the end of the year.
Rep. Susan Brooks, R-5th District, and Rep. Todd Rokita, R-4th District, both expect the first tax reform legislation to be adopted in three decades will provide a savings to middle-class families and small businesses.
Brooks was in Pendleton on Monday to meet with area residents and said he believes the momentum from the House passage of tax reform legislation last week will carry over to the Senate.
“I’m very optimistic,” she said. “I think the Senate will pull together. There is a good chance of passage because, unlike health care reform, the leadership in both chambers are in sync when it comes to timing.”
Rokita said the Senate shouldn’t change a thing in the bill passed by the House.
“This will create jobs and is targeting working families making less than $50,000,” he said.
Brooks said if tax reform is achieved by the end of the year people will see an increase in their paychecks starting in January because of the lower tax rates.
“The full impact won’t be realized until the 2018 taxes payable in 2019, but there should be an increase in the weekly paychecks,” she said.
As proposed in the House bill, the number of tax rates would be reduced from seven to four.
Brooks said the average Hoosier family should see a savings of $2,132 and a family of four with an income of $59,000 will see a savings of $1,280.
The tax reform measure is expected to create 18,975 full-time jobs in Indiana, she said.
“This is significant,” Brooks said. “It will simplify the filings with the IRS. The focus is on the middle class and small businesses.”
As proposed, the standard deduction will increase from $6,000 to $12,000 for individuals and from $12,000 to $24,000 for married couples. The standard deduction for children will increase from $1,000 to $1,600.
Rokita said the House bill caps at $10,000 the amount in state and local taxes that can be deducted from the federal taxes.
Brooks said the tax rate on small businesses will be reduced to 25 percent and only 9 percent for start-up companies. The corporate tax rate would be reduced from 39 to 20 percent.
“This will help keep jobs in the country,” she said. “Companies will not be lured overseas.”
Brooks said phasing out the inheritance tax will help family farms and small businesses from having to pay up to 40 percent in taxes.
“The House bill is pro growth, pro economy and pro families,” she said.