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| 316 Hart Senate |
| Office Building |
| Washington, D.C. 20510 |
| P: 202-224-4343 |
| F: 202-228-1373 |
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Taxes
Expanding Kentucky’s economy and creating more jobs in the Commonwealth is one of my top priorities in the Senate today. Unfortunately, the impact of the fallout from terrorism, stock market drops, and job losses in the last few years has had a negative impact on the pocketbooks of many Kentuckians. That is why I wanted to serve on the Senate Finance Committee and shape our national tax policy. I believe that by restructuring our tax code to allow the working people and entrepreneurs in Kentucky to keep more of the money they earn, we will see our economy improve.
And today, in 2004, that is exactly what we now see. The President’s tax cuts that we passed in 2001 and 2003 are jumpstarting the American economy and providing us with some positive movement in job creation. We passed these tax cuts to help the American family.
During the last few years, many important tax bills have come before the Senate, but the two largest pieces of tax legislation are the 2001 Economic Growth and Tax Relief Reconciliation Act and the 2003 Jobs and Growth Tax Relief Reconciliation Act.
The centerpiece of the 2001 tax law was reduced income tax rates. It established a new 10% income bracket for many Americans in the lowest income levels who had been paying taxes at a 15% rate. The establishment of this new low tax bracket benefits every Kentucky taxpayer. The law also reduced other tax bracket rates, over time, by 4.6%. In 2003, I also supported legislation to make these tax cuts go into effect more quickly for American taxpayers. According to the U.S. Treasury Department, over 1.2 million Kentucky taxpayers benefited from the new low 10% tax bracket.
Also important for Kentuckians was the relief from the so-called “marriage penalty”. The “marriage penalty” caused many American married couples to pay more in taxes than they would pay if they were two single taxpayers. Once again, the relief from this unfair tax law that was passed in 2001 was accelerated in 2003 to allow taxpayers to receive relief more quickly. I have strongly supported relief from the marriage penalty and am please that almost a half million Kentucky families have paid less federal income taxes because of the relief that my support helped to enact.
We also included other vital tax reforms in the 2001 law including an eventual elimination of the unfair estate tax. With tax rates of up to 55%, this tax has forced many Kentucky families to sell their family farms and businesses upon the death of a loved one in order to raise the cash to pay this confiscatory tax. Unfortunately, due to a technical quirk in Senate rules, this tax is currently set to be reinstated in 2011. I am proud of the progress we have made so far to rid Kentucky families of this tax and I will continue to work hard to make sure that this relief is permanent
The 2001 tax law also included other important tax changes to benefit Kentucky families such as an immediate increase in the child credit, the establishment of a tax deduction of up to $3,000 of qualifying higher education expenses for middle income Americans and higher deductibility of interest paid on student loans, and additional tax assistance for adopting families and families with relatives in need of dependent care.
This sweeping tax reform benefits the entire country and provides special tax cuts for Americans with the lowest incomes. But as I looked at our economy in Kentucky, I pushed to accelerate some of these cuts and add some additional tax relief in 2003. I supported and voted for the 2003 Jobs and Growth Tax Relief Reconciliation Act. This tax cut accelerates the 10-percent tax bracket expansion, the reduction in income tax rates and the marriage penalty relief. It also increases the amount of the child tax credit that Kentucky families can receive from $600 to $1000 in 2004. And it provides relief for over a quarter of a million Kentucky individuals and small businesses by reducing the tax on dividends and capital gains.
We have been working hard to pass a tax bill that provides relief for working families and helps create jobs. And the 2003 Jobs and Growth package we passed is providing the shot in the arm that our economy needs to get it growing again.
While the Senate has been dominated by these two essential tax bills, the fight is now to ensure that many of these tax cuts become permanent and the average American isn’t blindsided by taxes increasing to old levels. To that end I worked in the Budget committee to ensure that this year’s federal budget would allow Americans to continue to receive the benefits of the 10% tax bracket, marriage penalty relief, and $1,000 per-child tax credits in future years.
I work hard in Washington to make certain that the people of Kentucky get back as much of their tax dollars as possible. I believe that putting more money in the hands of working Americans is the best way to move our economy forward and create more jobs. |
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