By Nora Olabi
MAGNOLIA — U.S. Rep. Kevin Brady, R-The Woodlands, was greeted with cheers in a packed machining shop off FM 2978 during a town hall meeting on federal income tax and business reform.
As the chairman of the House Ways and Means Committee, Brady put forth his vision for a simplified tax code. He proposed a tax-filing method for families and individuals that could make filing taxes as easy as sending a postcard to the Internal Revenue Service, and he hopes to gather grassroots support to push his proposal through in Congress in 2017.
“The reason why I say we’re proposing it to you is because this is your tax code, not ours. It’s not Washington’s. You should have a say for the first time in your life on how you’re taxed,” Brady said. “You got to decide; you got to tell me. Do you want something this fair and this simple?”
Currently, there are seven federal income tax brackets based on an individual or family’s joint income, and those brackets range from as low as 10 percent to 39.6 percent of taxable income. Under Brady’s postcard tax-filing proposal, the tax brackets would flatten to three brackets – those who pay 12 percent, 25 percent and 33 percent. For some low-income workers who currently earn under $9,275 as individuals or $18,550 as married joint filers, Brady’s proposal would cut those taxes to zero. His proposal also would double each filer’s standard deduction.
“I want a tax code not designed to squeeze money from you, which is the one that we have today. I want a tax code built for growth,” Brady said.
The proposed tax reform would eliminate most tax credits and deductions in an effort to flatten the tax bracket and simplify the code. On the proposed “postcard,” a copy of which could be found online at kevinbrady.house.gov/feedback, filers would fill out 13 fields to calculate owed income taxes. The postcard includes room for child credit, earned income credit, higher education credit, a charitable contribution deduction and a mortgage interest deduction.
Brady also proposed breaking up the IRS, cutting taxes for businesses by 43 percent and a capital investment deduction for businesses as a method of incentivizing more local economic development instead of moving jobs abroad.
Brady’s message was well received in the room filled with employees at Lincoln Manufacturing Inc., a Magnolia-based company off FM 2978 that specializes in manufacturing casings and tubings for the energy industry and proudly proclaims its products are “Made in the USA.”
Businesses like Lincoln Manufacturing have to stay price competitive in a global market, and Brady hopes the proposed business tax cuts and deductions will help them grow well into the future.
“It’s pretty neat to have someone who is as accessible. … And even as a congressman and chairman of a very powerful committee in Congress, Kevin Brady has always been an accessible person. He truly did make major contributions to build up The Woodlands area and South Montgomery County,” said Eric Yollick, general counsel for Lincoln Manufacturing.
Additionally, Brady has proposed doing away with taxes on American manufactured products and taxing imports.
Other ideas Brady proposes include eliminating the estate tax, which he called “the most un-American tax,” cutting tax rates in half on dividends and interest earned on savings, and creating a small claims court for issues with IRS tax collection.