Washington, D.C. - U.S. Senator Susan Collins announced today that, after securing significant changes, she will support The Tax Cuts and Jobs Act, the first major overhaul of our nation’s tax code since 1986.
She released the following statement:
“I don’t think there is a single American who thinks that our current tax code is fair, simple, or promotes economic growth. We need a tax system that will boost the economy, help the middle class, and encourage small businesses to grow and create jobs. If we stimulate the economy through tax reform, we can significantly increase federal revenues while boosting Americans’ take-home pay.
“By nearly doubling the standard deduction and expanding the child tax credit, this bill will provide significant relief to lower- and middle-income taxpayers. For example, a single mother with one child earning $35,000 will see her taxes drop by nearly 4,000 percent. Instead of paying money to Washington, she will be getting more than $1,100 back each year to help her make ends meet.
“Over the past several weeks, I have worked to ensure that the Senate bill includes a number of important changes.
“First, I advocated strongly for restoring the state and local property tax deduction up to $10,000, a critical provision that will provide much-needed tax relief for hard-working, middle-income families. Passage of my amendment will allow the vast majority of Mainers who itemize to fully deduct their property tax bill. In Maine, 166,000 taxpayers who itemize deduct a total of $725 million in property taxes on their federal income tax returns. This is often the largest deduction taken by Mainers. In fact, Mainers have the 11th highest per capita property tax burden in the nation.
“Second, my amendment to help Americans struggling with high unreimbursed health care costs was incorporated into the bill. I am pleased that the final bill will include my amendment to lower the threshold for claiming the deduction for these unreimbursed expenses from 10 percent to 7.5 percent of income for two years. The House bill eliminated this long-standing deduction used by 8.8 million Americans – nearly half of whom make less than $50,000 per year. A harmful provision of the Affordable Care Act had increased the threshold to 10 percent of income. Lowering the threshold will provide relief for those experiencing particularly high health care costs, including seniors and those with pre-existing conditions. That is why the AARP and 44 other consumer groups endorsed my proposal.
“Third, I’m pleased that my amendment to reverse the Senate bill’s ill-advised elimination of catch-up contributions to retirement accounts for church, charity, school, and public employees was adopted. My amendment will help protect these employees – including firefighters, school teachers, and police officers – by striking provisions in the Senate bill that would have reduced their ability to save for retirement. These first responders and other public servants should not have their standard of living in retirement diminished because they chose to work in public service.
“In addition, I was deeply concerned that the repeal of the individual mandate would almost certainly lead to further increases in the cost of health insurance premiums – premiums that are already too expensive under the ACA. I am very pleased the Majority Leader committed to support passage of two important pieces of legislation before the end of the year to mitigate these increases. The first, the Bipartisan Health Care Stabilization Act introduced by Senators Alexander and Murray, will provide vital funding in 2019 and 2020 for the cost-sharing reductions received by low-income enrollees in the ACA exchanges. This funding helps low-income families pay their out-of-pocket costs, including deductibles and co-pays. The second is bipartisan legislation I introduced that would protect people with pre-existing conditions while lowering premiums through the use of high-risk pools. This plan will provide $5 billion annually for two years in seed money for states to establish invisible high-risk pools or traditional reinsurance programs. We know from experiences in the states of Maine and Alaska that high-risk pools can help to lower premiums substantially – by an average of 20 percent.
“I have also heard a great deal of concern from seniors with the Congressional Budget Office’s determination that an automatic four percent cut to Medicare, estimated to be roughly $25 billion for fiscal year 2018, could be triggered by the passage of this legislation as a result of the Pay-As-You-Go Act of 2010 (PAYGO) even though there is no intention for such a reduction to occur. Medicare provides essential benefits to our nation’s seniors, and any reduction in funding triggered in this way would be completely unacceptable. I wrote to the Majority Leader urging that we immediately remove the threat of an automatic cut in the program’s funding, which has been done on numerous occasions before, and I am pleased that he has said these cuts will be avoided. Speaker Paul Ryan has also joined in this pledge.
“Having secured these key improvements in the bill, as well as the commitments to legislation to help lower health insurance premiums, I will cast my vote in support of the Senate tax reform bill. As revised, this bill will provide much-needed tax relief and simplification for lower- and middle-income families, while spurring the creation of good jobs and greater economic growth.”