Today marks the thirtieth anniversary of Ronald Reagan’s signing of the Kemp-Roth Tax Cut Act of 1981. The bill’s official legislative name was the Economic Recovery Tax Act. The legislation was authored by Jack Kemp in conjunction with Senator William Roth. Both men were co-sponsors of the legislation but Jack Kemp was the main architect and the man credited for “selling Reaganomics to Ronald Reagan.” Then Congressman Jack Kemp, had introduced the Economic Recovery Tax Act in the House, several times before the 1981 legislative session, but Democrat Congressional leaders and a Democrat President failed to move on it.
But once Reagan became President, he took the initiative to act on it and successfully pushed The Kemp-Roth bill through Congress. Were it not for Reagan, the economy-saving legislative initiative may never have passed, but were it not for Jack Kemp, it may never have existed in a way that was quite as strong and definitive as it wound up being.
The Kemp-Roth Tax Cut amended the Internal Revenue Code of 1954 and was responsible for encouraging the economic growth through:
- The reduction of individual tax rates;
- By expensing depreciable property; and
- Creating incentives for savings and other small businesses.
The main features of the Act were responsible for:
- Reducing the tax rates by 25% over three years;
- Accelerating depreciation deductions;
- Indexing of individual income tax parameters;
- Excluding income of two earner married couple by 10 %;
- Reducing windfall profit taxes; and
- And expanding provisions for employees stock ownership plans.
Once enacted, the days of malaise that existed under the old tax code during the Carter years, turned into the days of rejuvenation. It took a while to actually turn the economy around but it didn’t take as long as many predicted and once the economy did turn the corner, it took off.
Jack Kemp is no longer with us , but if he was I am sure he would repeat the following words that he once spoke:
“Every time in this century we’ve lowered the tax rates across the board, on employment, on saving, investment and risk-taking in this economy, revenues went up, not down.”
And he would be right.
We need more leaders like Jack Kemp today, but until one is found, we have the Kemp legacy to help guide us, and hopefully we will soon have leaders who will see that light that Jack Kemp, William Roth, and Ronald Reagan once shed upon us with their faith in less government, less spending, less taxation, and more freedom.
Today however, on this thirtieth anniversary of the signing in to law of the 1981 Economic Recovery Tax Act (ERTA), I ask that you pay homage to Jack Kemp by visiting a Facebook page that has been dedicated to him, his life, his work and his legacy. Please visit the Jack F. Kemp Facebook page and press the “like” button. Show your appreciation for him, his leadership and his belief in people more than government, and the free market than the government bureaucracy