Over the last several months, there has been much debate over the impacts of the Tax Cuts and Jobs Act, enacted at the end of last year. However, the concrete results are impossible to dispute: 4 million workers across America have received bonuses or pay increases as a result of tax reform; totaled together, these bonuses are worth over $3 billion, and counting. In fact, even the left-leaning Tax Policy Center found the Tax Cuts and Jobs Act would reduce taxes by roughly $1,600 on average in 2018. Though some have claimed this money amounts to “crumbs,” these crumbs are adding up – especially here in southern and southwestern Ohio.
Earlier this month, President Trump visited the Sheffer Corporation, a small manufacturing company in Blue Ash that pledged $1,000 bonuses to all 126 of its employees as a result of the Tax Cuts and Jobs Act. Making similar efforts as a result of tax reform, Cincinnati companies Fifth Third Bank and First Financial both pledged company minimum wage increases for hourly employees. Far from what my colleagues across the aisle predicted, corporations are passing their savings along to their hard-working employees.
These savings are not limited to corporations either – these bonuses and pay raises come from businesses of all sizes. More importantly, the individuals receiving bonuses and raises are real, hard-working Americans, for whom the extra money makes a difference. Don’t take my word for it, take theirs: during President Trump’s visit to Cincinnati, he invited Sheffer employees on stage to talk about their plans for their bonuses.
A mom in the audience said she is using her bonus as spare cash for when she sends her children off to college this year. As any parent of a college student knows, the expenses involved go far beyond tuition and books. Housing and incidental expenses add up, and every dollar makes a difference.
President Trump also invited a young man to the stage to speak. He wants to start a family, and said that his money will go towards a home to raise his children in. These are real stories from our neighbors in Cincinnati. These savings have made a tangible difference for real people who live in the real world.
Fortunately, this is just the start of the good news for families across America. Soon, most Americans can expect to see their take-home pay increase, as the IRS has adjusted its income tax withholding tables for 2018 to account for the lowered tax brackets for nearly every American.
As many Ohioans know too well, income tax withholding is the amount of money the federal government takes from every paycheck. Under the Tax Cuts and Jobs Act, the federal government will take less money from Americans at every income level. This month, employers will begin to update federal income tax withholding to reflect the new law. 90 percent of workers are expected to see more take-home pay, so check your check: you could be taking home more of your hard-earned money as early as this month.
For most of you reading, your net pay and federal tax withholding numbers will shift in your favor. Federal tax withholding will decrease for many Americans due to the newly-lowered rates and nearly-doubled standard deduction. Lower tax withholding means an increased net pay for many Americans and more money in families’ pockets each paycheck.
As President Reagan said, “Whenever we lower the tax rates, our entire nation is better off.” We are all tired of government waste – it is time to return money to the people who earned it, and give them the opportunity to put it to good use. The bonuses and pay raises pledged over the last several months are just the beginning; for many Americans, and for our economy, the best is yet to come.