The President-Elect Is Right: We Need Tax Reform Now
December 23, 2016
Bill Cobb, President and Chief Executive Officer at H&R Block
Since the election, we’ve heard a lot about the potential for tax reform and how it will affect taxpayers and companies alike. The president-elect shared that in his first 100 days in office, there will be sweeping changes, and many have speculated how those changes will impact the tax preparation industry and our business. I agree with President-elect Trump’s goal to reform the tax code. The tax code is complex and difficult to navigate for many Americans, and it’s time for a change.
Here are three foundational commitments from the president-elect that we at H&R Block see as bright spots on his tax agenda:
- Streamline the tax code. President-elect Trump wants to reform the tax code. He’s right on the money with this one. Today, the federal tax code is 187 times longer than it was a century ago – and it was certainly much simpler when we began this company in 1955. Here’s one example of how complex our tax code has become: There are currently five different definitions of a “child.” Not only is that difficult for taxpayers to understand, it’s also challenging from a business perspective, because we must train our tax experts to understand the nuances of these types of variations every year. Eliminating confusion and redundancies like this would go a long way to making the tax code easier to navigate. In addition, his proposal to reduce the number of tax brackets from seven to three and eliminate the alternative minimum tax (AMT) are two areas worthy of further discussion. Bottom line: The code as it exists creates unnecessary strain for hardworking Americans, and we need to focus on helping taxpayers get their taxes won.
- Decrease burdens on small businesses. President-elect Trump’s tax agenda could also bolster small businesses across this country by reducing the complexity and number of rules that overburden small businesses with administrative costs and hamper growth and innovation. Like H&R Block’s 1,600 franchisees across the country, small businesses must continually adapt to the ins and outs of the tax code. Additionally, many small businesses don’t have the time or money to hire outside help to navigate the tax code and its rules.
- Reform corporate tax. It’s been 30 years since Congress has addressed significant changes to the corporate tax structure, and we think that it’s the right time to examine this issue. Lowering the business tax rate from 35 percent to 15 percent and eliminating the corporate AMT could be significant for many U.S.-based companies, including ours.
As the new Congress and administration take office in the New Year, we look forward to working with the president-elect’s team and Congress on these issues. Regardless of the tax reform changes to come, we know that people are always going to want expert help to make sure they get the most money back. H&R Block is a proud American company with more than 80,000 associates nationwide who have helped taxpayers get the most money back on their taxes for more than 60 years. Just like the president-elect, we believe in winning for the taxpayer, and we’ll be here to help them win the tax season come January.