Ryan Hails House Passage of His Proposal to Stop Massive Tax Hike in 2011

WASHINGTON – U.S. Congressman Paul Ryan (R.-WI.) today praised the majority in the House of Representatives who voted for legislation containing his proposal to make permanent the 2001 tax relief law by striking the December 31, 2010 "sunset" provision – a proposal that he and Congressman Kenny Hulshof (R.-MO.) had introduced to provide lasting tax relief. The House voted 229-198 in favor of this measure.

Although the original intent of last year’s tax relief law (the Economic Growth and Tax Relief Reconciliation Act of 2001) was to provide permanent tax relief, opponents used a procedural Senate rule to force this law to sunset December 31, 2010. As a result, taxpayers face an enormous federal tax increase on January 1, 2011, whereupon tax levels are set to return to levels prior to last year’s tax relief law. The House today took an important step to prevent this tax hike. According to the Congressional Budget Office and Joint Committee on Taxation, this bill will not affect the Social Security surplus.

"The House vote today was a victory for all American taxpayers – individuals, families, and small businesses," Ryan said. "Today we rejected what would be the largest overnight tax increase in U.S. history. We said ‘no’ to restoring the marriage tax penalty, reviving the death tax, cutting the child tax credit in half, increasing federal income tax rates across-the-board, and significantly lowering the amount that workers can put into their IRAs and 401(k)s each year. Instead, we voted for lasting tax relief that will strengthen our economy."

"We also stood up for greater fairness in the tax code, over the long haul," Ryan said. "For small businesses throughout our communities, last year’s rate cuts meant they would no longer have to pay higher federal tax rates than big corporations. They need to know this wasn’t just a temporary fix, so they can plan ahead, expand, and create jobs."

"I call on the Senate to take up this vital legislation. Refusing to act on this hinders job growth and economic recovery. Inaction also makes it very tough for families and small businesses to plan financially for the future. The Senate should not play partisan games with this bill," Ryan said.

The table below illustrates, in part, what would happen if the sunset provision of last year’s tax law remains in force: