    [House Hearing, 118 Congress]
    [From the U.S. Government Publishing Office]

                        FIELD HEARING ON THE SUCCESS OF
                       PRO-GROWTH, PRO-WORKER TAX POLICY
                            IN THE AMERICAN MIDWEST

    =======================================================================

                                    HEARING

                                   BEFORE THE

                          COMMITTEE ON WAYS AND MEANS
                            HOUSE OF REPRESENTATIVES

                        ONE HUNDRED EIGHTEENTH CONGRESS

                                 SECOND SESSION

                                   __________

                                AUGUST 16, 2024

                                   __________

                              Serial No. 118-FC31

                                   __________

             Printed for the use of the Committee on Ways and Means

    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

                                   __________

                       U.S. GOVERNMENT PUBLISHING OFFICE
    56-529                       WASHINGTON : 2024

    -----------------------------------------------------------------------------------

                          COMMITTEE ON WAYS AND MEANS

                        JASON SMITH, Missouri, Chairman

    VERN BUCHANAN, Florida               RICHARD E. NEAL, Massachusetts
    ADRIAN SMITH, Nebraska               LLOYD DOGGETT, Texas
    MIKE KELLY, Pennsylvania             MIKE THOMPSON, California
    DAVID SCHWEIKERT, Arizona            JOHN B. LARSON, Connecticut
    DARIN LaHOOD, Illinois               EARL BLUMENAUER, Oregon
    BRAD WENSTRUP, Ohio                  BILL PASCRELL, Jr., New Jersey
    JODEY ARRINGTON, Texas               DANNY DAVIS, Illinois
    DREW FERGUSON, Georgia               LINDA SANCHEZ, California
    RON ESTES, Kansas                    TERRI SEWELL, Alabama
    LLOYD SMUCKER, Pennsylvania          SUZAN DelBENE, Washington
    KEVIN HERN, Oklahoma                 JUDY CHU, California
    CAROL MILLER, West Virginia          GWEN MOORE, Wisconsin
    GREG MURPHY, North Carolina          DAN KILDEE, Michigan
    DAVID KUSTOFF, Tennessee             DON BEYER, Virginia
    BRIAN FITZPATRICK, Pennsylvania      DWIGHT EVANS, Pennsylvania
    GREG STEUBE, Florida                 BRAD SCHNEIDER, Illinois
    CLAUDIA TENNEY, New York             JIMMY PANETTA, California
    MICHELLE FISCHBACH, Minnesota        JIMMY GOMEZ, California
    BLAKE MOORE, Utah
    MICHELLE STEEL, California
    BETH VAN DUYNE, Texas
    RANDY FEENSTRA, Iowa
    NICOLE MALLIOTAKIS, New York
    MIKE CAREY, Ohio

                           Mark Roman, Staff Director
                     Brandon Casey, Minority Chief Counsel

                             C  O  N  T  E  N  T  S

                                  ----------

                               OPENING STATEMENTS

                                                                       Page
    Hon. Jason Smith, Missouri, Chairman.............................     1
    Advisory of August 16, 2023 announcing the hearing...............     V

                                   WITNESSES

    Karen Dewalt, Vice President, Global Tax, The Home Depot.........     6
    Sarah Curry, Mother, Glenwood, Iowa, and Research Director,
      Iowans for Tax Relief Foundation...............................    13
    Jolene Riessen, Farmer, Ida Grove, Iowa, and President, Iowa Corn    18
    Steve Sukup, President and CEO, Sukup Manufacturing Co...........    22
    Lana Pol, Owner and President, Geetings, Inc.....................    31

                        LOCAL SUBMISSIONS FOR THE RECORD

    Local Submissions................................................   129

                       PUBLIC SUBMISSIONS FOR THE RECORD

    Public Submissions...............................................   143

    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

                           THE SUCCESS OF PRO-GROWTH
                            PRO-WORKER TAX POLICY
                            IN THE AMERICAN MIDWEST

                                  ----------

                            FRIDAY, AUGUST 16, 2024

                              House of Representatives,
                                   Committee on Ways and Means,
                                                        Washington, DC.
        The committee met, pursuant to call, at 9:01 a.m., Central,
    Oman Family Youth Inn, Logan Avenue, Iowa State Fairgrounds,
    Des Moines, Iowa, Hon. Jason Smith [chairman of the committee]
    presiding.
        Chairman SMITH. The committee will come to order.
        Without objection, the gentlewoman from Iowa, Mrs. Hinson,
    the gentlewoman from Iowa, Dr. Miller-Meeks, and the gentleman
    from Iowa, Mr. Nunn, are authorized to participate in the
    hearing and ask questions today.
        Good morning, and welcome to everyone who is joining us
    today at the Iowa State Fair.
        I want to thank my good friend, Randy Feenstra, for hosting
    us in his home State. Randy is a true champion for rural
    America and small towns because it is where he is from. I can
    tell you that when he is in D.C., he always brings Iowa with
    him. It is not Missouri, but it is Iowa, so----
        Mr. FEENSTRA. A little better.
        Chairman SMITH. We also have the entire Iowa House
    delegation joining us today. Few delegations are as good as the
    one up here about banding together to fight for their home
    state and for their communities.
        I do want to take a minute just to express my
    disappointment that not one of our Democrat colleagues have
    joined us here today on the committee. This is our second field
    hearing in a row where none have made the effort to join us in
    conducting our committee business outside the marble halls of
    Washington, D.C.
        We are here to sit down and have a conversation with
    working people about the need to protect Americans from a $4.6
    trillion in tax hikes that will happen the end of next year.
    You would think that would merit at least one Democrat showing
    up to listen. With proper notice, multiple weeks, there are
    still empty chairs.
        The State Fair couldn't be more different than the halls of
    Congress, and that is exactly why we are here, to listen to
    regular people, people who run a small business, work their
    farm, or folks just trying to make ends meet for their
    families.
        Part of the problem is every dollar you earn is taxed over
    and over again. Just think about all the taxes you pay every
    day. You pay property tax on your house. You pay taxes on the
    land you own and work. Your car and the gas to fill it up to
    get to your job or to use on your farm are taxed. Taxes on your
    employer means a smaller paycheck for you. That paycheck is
    taxed by Washington, and then taxed again buying groceries and
    other basics for your family. Once you stop working, your
    retirement is taxed. Even after death, Uncle Sam still wants
    his cut, and he wants your grieving family members to pay it.
        Republicans look at working families and want to make it
    easier to help them get ahead. And we know that a smaller
    government, less regulations, and less taxation is the way to
    do that.
        Under President Trump, we passed a tax cut that benefited
    the working class. After that tax cut, people making less than
    $100,000 got, on average, a 16 percent cut in their tax bill to
    the government, while the top one percent actually saw their
    share of taxes go up. Workers in the bottom 10 percent saw 50
    percent faster wage growth than people in the highest 10
    percent. When working families prosper, America prospers.
        Five million jobs were created after enactment of the Trump
    tax cuts. Investment rose over 20 percent. We ended the
    decades' long trend of American businesses moving their
    headquarters and jobs overseas.
        The lesson we should take from the Trump tax cuts is that
    when we put working families first, help small businesses
    succeed, and give Americans the tools to outcompete China,
    America will win.
        Democrats in Washington, including Vice President Harris,
    they don't see it that way. They look at working families, and
    they see an ATM to fund their big government spending. That is
    why President Biden and Vice President Harris have both
    separately promised to let these beneficial tax cuts expire in
    order to raise taxes on all Americans, every single American.
        Vice President Harris has actually gone so far to call it a
    day one priority to repeal the Trump tax cuts in their
    entirety. Letting the Trump tax cuts expire would mean the
    average family of four earning $75,000 or less a year would
    face a $1,500 tax increase. That means smaller paychecks for
    families already struggling to make ends meet because of
    inflation that has gone up more than 20.3 percent in the last
    3.5 years.
        The Child Tax Credit would be slashed in half. The
    guaranteed deduction would be cut in half. The death tax
    exemption would also be slashed in half, especially hurting
    farmers in states like Iowa and Missouri. Small and family run
    businesses, like so many farms are, would see their tax burden
    climb to 43.4 percent, making it harder to compete against
    larger corporations paying a 21 percent tax rate.
        So other than tax increases, what exactly are the tax
    priorities of the other side? As I said, none of my Democrat
    colleagues are here to answer that question. But if they were,
    my guess is they would be celebrating that today, that this
    very day actually marks the 2-year anniversary of the so-called
    Inflation Reduction Act becoming law. Democrats stuffed that
    bill with $650 billion in special interest tax breaks for the
    wealthy, their donors, big banks, billion-dollar companies, and
    China. Despite its name, the Inflation Reduction Act has done
    nothing to lower prices from where they were 2 years ago. It
    would be better named the Inflation Expansion Act.
        None of this would have happened without Vice President
    Harris' tie-breaking vote in the Senate. As the tie-breaking
    vote, she helped usher through a $10 trillion increase in
    government spending in just their first two years in office.
    This is the Democrats' plan for America, higher prices and
    higher taxes for the little guy and welfare for the wealthy and
    well-connected.
        That is why Republicans on this committee have formed tax
    teams and are traveling all over the country to build on the
    successful Trump tax cuts and stop the $7 trillion Biden-Harris
    tax hike. We have held over 60 meetings so far, with many more
    on the way. And just yesterday, the Rural America Tax Team led
    by Chairman Smith traveled through Nebraska and western Iowa to
    hear how the Tax Code can help farmers and small towns.
        I want to thank the witnesses for all being here today and
    sharing how the Trump tax cuts made a difference for you and
    your community.
        We also want to hear from everyone in attendance. There
    will be clipboards that our teams will pass out throughout the
    process we ask that you submit for the record. We will enter
    those into the official House record of the hearing and take
    those back with us to Washington as we consider how to build on
    the successes of the prior tax cuts.
        I am pleased to recognize our generous host, our good
    friend, Congressman Feenstra, for 1 minute.
        Mr. FEENSTRA. Thank you, Chairman Smith.
        I want to thank my colleagues for coming. We have taken
    Congress out of D.C. and brought it to the breadbasket of the
    world, to the Midwest, to Iowa, and I want to thank you for
    being here.
        I want to thank our witnesses for coming today. I want to
    thank Karen, Sarah, Jolene, Steve, and Lana for taking the time
    to answer the questions that we might have.
        This is so important for us as a state, for the Midwest.
    You think about what we have, from cattle to hogs, to dairy to
    eggs, to turkeys, to biofuels, to corn and soybeans. This is so
    important. This is our way of life that we are going to talk
    about today. But our way of life is affected when the tax cuts
    that happened in 2017 go away.
        I think of our families, where we doubled the standard
    deduction in 2017. We doubled the Child Tax Credit for our
    families. I think of the small businesses and agricultural
    community that does the 199A, pass-through credit, got a 20
    percent discount. They got interest expensing reduced, got 179
    depreciation increased. It goes on and on. But all these things
    go away and all have a dramatic affect for our families, for
    our small businesses, for our main streets. And when they are
    affected, our schools are affected, our hospitals are affected,
    and so many other things. That is why it is so important that
    we have this discussion today.
        And, finally, I just want to say, I ushered through in
    2018, when the Tax Cuts and Jobs Act was passed, I ushered it
    through the Iowa Senate where we did the largest tax cut at
    that time in Iowa history. Well, I will say this: I did it in
    the Iowa Senate, being chair of the Ways and Means, and I will
    come through again for each Iowan to make sure that these tax
    cuts continue to be cut as we move forward.
        Thank you so much, Chairman.
        Thanks, everyone, for being here.
        Chairman SMITH. Thank you.
        I am pleased to recognize the gentlewoman from Iowa, Mrs.
    Hinson.
        Mrs. HINSON. Thank you, Mr. Chairman. Thank you for coming
    back to the State Fair, repeat customer. This is the second
    year in the row Mr. Chairman has been here.
        Thank you to our witnesses and to everyone in the audience
    for coming out to talk about these important issues that affect
    our businesses here, our farmers, our producers, and working
    families. We are going to highlight a lot of those really
    important issues today.
        Mr. Chairman, I was struck by what you said about the
    agenda coming out of the Harris administration, Harris-Biden
    administration, and they will raise your taxes. I serve on the
    House Appropriations Committee, so thank you for letting me sit
    in as a guest today. But our committee is responsible for,
    hopefully, judiciously spending your tax dollars.
        I think there is a philosophical difference happening right
    now in Washington, D.C. We believe that that is your money, not
    the government's money. But our ranking member on that
    committee said just a few months ago in our markups this year,
    we do not have a spending problem; we have a revenue problem.
    That to me is code for they want to raise your taxes and they
    are addicted to spending your money.
        So Democrats, including Vice President Harris, have
    promised to roll back these important tax cuts that Randy was
    just talking about, calling for a repeal of stepped-up basis
    and expiration of the 199A small business deduction. These are
    policies that so many multigenerational small family farms and
    businesses rely on every single day. And these are a critical
    tool to support all of our economies, but especially our rural
    economy here in Iowa.
        So we need to be competitive. We need to be competitive
    with our adversaries like the Chinese Communist Party. And I
    look forward to having the discussion today with our witnesses
    and all of you and my fellow colleagues from all over the
    country about how we can make sure we are returning that money,
    your money, back to you.
        And, Mr. Chairman, I yield back.
        Chairman SMITH. Thank you.
        I am pleased to recognize the gentleman from Iowa, Mr.
    Nunn.
        Mr. NUNN. Well, Chairman Smith, thank you so much for being
    here in the heart of the heartland. You know, I think we need
    more of these hearings outside of the beltway and right in the
    corn belt, because this is where you are going to hear not
    from, you know, politicians and lobbyists but from real
    practitioners and real leaders.
        I am thrilled with the lineup that we have today, and I am
    grateful for members across the country on your Ways and Means
    Committee taking time to come out here and learn how it impacts
    your district, then learn how it impacts really the middle of
    America and the jobs and the families and the lives that are
    impacted directly by this.
        I am proud that on day one as a freshman on this panel, I
    went against the establishment to make sure that we fought for
    key taxes that impact our State. Working with this team here,
    we held together to make sure that biofuels were part of
    America's energy solution and our national security solution.
    With that, we were able to achieve it, and with your help, Mr.
    Chairman, thank you for hearing us out on this.
        I am also very proud, you know, as a dad of six, with two
    foster kids here that are now adopted, that we have made a
    priority of the Child Tax Credit. It helps every family, it
    grows the economy, and it is important for our future here as
    families.
        And I am also privileged to help lead the HEART Act to help
    families who are decimated by natural disasters like those that
    happened right here in Greenfield, Iowa, where nearly a third
    of the town was destroyed by severe storms and tornadoes.
        The 2017 tax credit has been a critical lifeline for all
    Americans, but particularly those right here in Iowa, with the
    average Iowa family of four seeing a 22 percent tax cut,
    because of your good work. If these are allowed to expire
    through inaction or false promises, Iowans will see a 22
    percent increase in their overall taxes at a time when no Iowa
    family can afford it.
        Because of the leadership that has happened both on this
    committee and I would say with your Iowa delegation, we have
    been part of the team that has cut Iowa taxes three times, the
    largest tax cuts in Iowa history. We have a proven example of
    how this works to grow the economy, to help all families, and
    as my colleagues highlighted here, to make sure that we pay off
    our debt while being successful for the future.
        Because of these tax cuts, Iowans have more money in their
    pockets and they invest them right in the communities that
    matter, spending on their families and their communities and to
    grow our local economy.
        So, Mr. Chairman, thank you for doing this, and thank you
    for the opportunity to join you.
        Chairman SMITH. Thank you, sir.
        I will now introduce our witnesses for today.
        The first one is Karen Dewalt, who is the vice president
    for Global Tax at Home Depot. We have Sarah Curry, who is a
    mother of three from Glenwood, Iowa, and serves as the research
    director at the Iowans for Tax Relief Foundation. We have
    Jolene Riessen, who is a farmer from Ida Grove, Iowa, and
    serves as the president of Iowa Corn. We have Steve Sukup, who
    is the president and CEO of Sukup Manufacturing Company, a
    family-owned grain storage and drying manufacturer based in
    Sheffield, Iowa. And we have Lana Pol, who is the owner and
    president of Geetings, a small trucking company based in Pella,
    Iowa.
        Thank you all for joining us today. Your written statements
    will be made part of the hearing record, and you each have 5
    minutes to deliver remarks.
        We will start with you, Mrs. Dewalt. You may begin.

    STATEMENT OF KAREN DEWALT, VICE PRESIDENT, GLOBAL TAX, THE HOME
                                 DEPOT

        Mrs. DEWALT. Thank you, Chairman Smith.
        Members of the Ways and Means Committee and members of the
    Iowa delegation, thank you for the opportunity to testify on
    behalf of The Home Depot on why it is important to keep a
    competitive corporate tax rate. As the largest home improvement
    retailer, The Home Depot is uniquely in tune with how a
    competitive corporate tax rate is essential to staying in
    business in the United States.
        The Tax Cuts and Jobs Act, TCJA, which reduced the
    corporate tax rate to 21 percent, has been necessary in
    enabling American companies like ours to create jobs, invest
    domestically, and offer low prices on products for Iowans and
    all consumers. I am here today to share just how much The Home
    Depot invests in our great country.
        In the U.S., we operate over 2,000 stores and employ over
    400,000 associates. Every Home Depot job supports more than
    four additional jobs across the U.S., which is more than twice
    the retail average. In Iowa alone, we support more than 7,000
    jobs.
        In 2023, Home Depot paid $5 billion in corporate income
    taxes, which is approximately 1 percent of all Federal income
    taxes collected in the United States. No one can say that we
    don't pay our fair share in taxes.
        Since the enactment of TCJA, we have undertaken several
    initiatives that demonstrate the positive impact of a lower tax
    rate.
        First, expansion and employment. We have invested $1.2
    billion in our supply chain since 2017, establishing over 100
    warehouse facilities. This has created more than 18,000 jobs in
    the U.S., improved our operational efficiency, and expanded our
    ability to deliver large, bulky merchandise like lumber,
    insulation, and roofing to better serve our pro customers.
        Second, investment in our workforce. The Home Depot
    invested approximately $1 billion in frontline associate wages
    in 2021 and an additional $1 billion annualized wage investment
    last year, ensuring our employees are compensated fairly and
    competitively. This benefits our associates and contributes to
    local economies through increased spending power.
        Additionally, our store managers see the benefit of our
    wage investments in the lives of our associates. Our West Des
    Moines store manager told the story of one of his associates, a
    local Iowan whose life has changed from the Home Depot's
    investment in wage. She has gone from working two jobs to make
    ends meet to joining The Home Depot, growing her career, now as
    a department supervisor, and just moved in to a new apartment
    with her son.
        Finally, we have invested significantly in technology to
    create an interconnected retail experience and help our
    associates provide better customer service.
        Now we are embarking on our next growth chapter, planning
    to open 80 new stores over the next five years, more than a
    dozen of which have already opened.
        These examples show that when we were given a lower rate
    through TCJA, we aggressively invested it back into our
    business and people. Any increase in the corporate rate will
    decrease the capital that we have to invest in our associates,
    stores, infrastructure, and capabilities, and will threaten to
    make us less competitive. Our investments in local communities
    through job creation, small business support, and giving back
    help stimulate local economies and improve quality of life.
        For example, we have over 80 small businesses in Iowa and
    Missouri that deliver supplies to our stores. These suppliers
    sold more than $140 million worth of product to The Home Depot
    in 2023.
        In addition, Home Depot is committed to supporting
    communities with natural disaster preparedness, short-term
    response and long-term recovery, which makes a real difference
    when the need arises. In 2023, The Home Depot Foundation
    committed more than $8 million for disaster preparedness,
    response, and long-term recoveries in impacted communities from
    natural disasters. And this May, the Foundation committed up to
    $300,000 to harder-to-reach communities, including those in
    Iowa impacted by tornadoes and severe flooding. This is an
    invaluable impact of our footprint with associates in every
    state in the U.S. ready and able to serve our communities.
        In conclusion, maintaining a competitive corporate tax rate
    of 21 percent is essential for the continued growth and success
    of U.S.-based companies like The Home Depot. It enables us to
    invest in our business, create jobs, and provide value to
    American consumers while supporting the broader economy.
        Our stores don't just sell products. They empower
    homeowners to renovate and maintain their homes at a reasonable
    cost, and they enable small to mid-size contractors to grow
    their businesses. We urge policymakers to consider the positive
    impact of the current tax rate on businesses, communities, and
    the nation's economic health.
        Thank you.
        [The statement of Mrs. Dewalt follows:]
       [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Chairman SMITH. Thank you.
        Mrs. Curry, you are recognized.

    STATEMENT OF SARAH CURRY, MOTHER, GLENWOOD, IOWA, AND RESEARCH
               DIRECTOR, IOWANS FOR TAX RELIEF FOUNDATION

        Mrs. CURRY. Thank you, Chairman Smith and members of the
    committee, for giving me the opportunity to comment here today
    on how the Tax Cuts and Jobs Act has impacted me and my family.
        My name is Sarah Curry. I am a wife and a mother to my
    three boys, Phillip, who is six, Isaac, who is four, and
    Benjamin, who is two.
        My family lives in rural southwest Iowa on approximately 10
    acres. You have to drive down about 3 miles of a gravel road to
    get to my home. My husband works as a radiation oncology nurse
    at the nearby hospital, and I am a research director for a
    nonprofit here in Des Moines.
        With three boys and two working parents, our family
    benefited immediately from many of the policies included in the
    TCJA. At the top of the list is the expansion of the Child Tax
    Credit. For my sons, keeping more of our earnings helped us
    with the needs that all parents have for babies and toddlers.
    However, the tax credit has been especially significant for my
    family when Isaac arrived, because he was diagnosed with autism
    spectrum disorder. The cost of Isaac's medical appointments and
    therapists is a large financial burden on my family, so we
    redirect every dollar that otherwise would go to taxes to his
    therapies.
        Another benefit my family has appreciated is the increased
    standard deduction. Expanding the standard deduction and
    limiting major itemized deductions simplified our tax filing
    process, and it has helped us as a family make decisions based
    on our lives rather than the tax rules.
        A third provision of the TCJA that helped my family is the
    change in the marginal tax rates. Over the years, my husband
    and I have worked hard, earning additional degrees,
    certifications, and receiving promotions to grow in our
    careers, and as a result, our taxable income has increased.
    Within the TCJA we saw immediate savings. If these reduced
    marginal tax rates were to sunset, our family would see an
    immediate tax increase, and that would directly impact our
    family budget and the resources we have for our children.
        That is the personal side of my testimony. But given my
    background in public finance, I also want to give you my
    professional perspective on the impact TCJA will have on Iowa
    families.
        Iowa's tax structure draws upon the Federal Code as a
    starting point for calculating our state income taxes, and so
    the TCJA has ramifications for us on that side as well. Our
    state once had nine income tax brackets with a top rate of 8.98
    percent, but starting next year, we will have a flat tax and a
    rate of 3.8 percent. State-level policymakers have worked to
    reduce the tax burdens on Iowans, but a sunset of the TCJA
    would erode some of those tax savings.
        In 2018, state lawmakers conformed our state tax policy to
    many of the TCJA provisions, so a sunset of the Federal tax
    policies will present a problem. Iowa will have to figure out
    how to maintain a less complex tax system for Iowans that does
    not result in a tax increase while still conforming to federal
    tax policy.
        As a policy expert and, more importantly, as a mom, I can
    testify that the increased tax liability would hurt my family
    and many others, both at the federal and state level. My
    family's tax burden directly affects the amount of income my
    husband and I can spend on our three young children and the
    pressure on us to spend time away from them working. Having a
    child with special needs makes us especially sensitive.
        As Iowans, we feel like lawmakers in our state have worked
    hard for us to keep more of our income, by lowering the top
    rates and simplifying our tax structure. As an American, I ask
    you to look to Iowa and the other states that have enacted
    similar reforms in response to the request of families across
    America for lower taxes.
        Thank you for your time and the consideration of my
    testimony today.
        [The statement of Mrs. Curry follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Chairman SMITH. Thank you.
        Ms. Riessen, you are now recognized.

       STATEMENT OF JOLENE RIESSEN, FARMER, IDA GROVE, IOWA, AND
                          PRESIDENT, IOWA CORN

        Ms. RIESSEN. Thank you, Mr. Chairman, and welcome to Iowa.
    I appreciate the opportunity to appear before you today and to
    commend you for holding this important hearing on tax
    implications that impact family farms across Iowa and the rest
    of the United States.
        My name is Jolene Riessen. I am a farmer and current
    president of the Iowa Corn Growers Association that has a
    membership of over 7,500 farmers and agribusiness associates.
    My organization takes its direction from our grassroots
    memberships, and by allowing me to speak today, you will be
    hearing their concerns through me, in addition to my own
    personal experiences for my crop and cattle operation in
    northwest Iowa.
        As a farmer, we are at a critical juncture. Currently,
    commodity prices will not cover the cost of production, let
    alone the extra moneys to be spent in the community, hurting
    our rural and national economies. A strong farm economy makes
    for a strong national economy. That is why a good tax policy is
    vital to keep family farms in business.
        Iowa Corn works in conjunction with the National Corn
    Growers Association, and together we were supportive of your
    negotiated tax package, H.R. 7024, the Tax Relief for American
    Families and Workers Act. And we appreciate your work on these
    important tax matters, like the bonus depreciation and Section
    179 provisions.
        So every year, our Corn Growers Association conducts a
    member survey. We just got the results back. Over 90 percent of
    our members say that tax policy is number one to them, and we
    as an organization need to be focused on that. Tax policy is so
    important for our farmers to continue to thrive throughout the
    countryside.
        So next year, I will be eligible for Medicaid, which means
    entertaining thoughts about retiring and passing the family
    farm on to the next generation, or for me, my two boys. So I,
    as so many other farmers, are making plans for passing that
    farm down to the next generation, and changing tax provisions
    are a huge part of that estate planning process.
        So here are my thoughts to you to carry back to Washington.
        Number one, leave the estate tax rate at $13.6 million per
    person and adjust it for inflation annually.
        Number two, keep bonus depreciation, which allows us to not
    only modernize our equipment but allows us to farm more
    efficiently.
        And, number three, keep stepped-up basis, which allows us
    to transfer ownership of farmland and equipment, reducing
    capacity gains tax for our heirs.
        If these tax provisions change, it will be catastrophic for
    us and so many others who need their land and equipment to keep
    the farm operational.
        So let me just use my farm as an example. If the current
    estate tax rate stays at 13.6, I will be able to successfully
    pass my ground and equipment to my boys, without placing them
    in a tax liability position. However, if the current level is
    reduced back to $6 million, here is what is going to happen. My
    boys will either have to sell all the equipment and 70 acres or
    they are going to have to sell 275 acres of land and be able to
    keep the equipment.
        Both choices, in my book, are unacceptable, since selling
    275 acres of ground would mean that over half of the land that
    they stand to inherit is going to be gone and, for me, it will
    be destroying what their dad and I worked so hard to build.
        So our story is more common than not. Currently, 97 percent
    of farms are family-owned in the United States, so you will be
    decimating what helped build the strong American farm economies
    we know today. With the possible sale of the land to pay the
    estate tax, chances are it is going to be a larger farmer that
    buys that ground, not a beginning or a small farmer, which
    would add to the vertical integration that is already going on
    in the countryside.
        Plus, now let's add the taxes of the sale of that land and/
    or equipment and then let's go to town and try and find a local
    lender to set up financing to be able to buy that equipment, to
    be able to buy that land back. And if successful, interest
    rates are going to be incredibly high just due to the riskiness
    of that loan.
        Couple that with the depressed farming commodity prices
    that we have today--and, oh, by the way, corn is down another 6
    cents today--will make it next to impossible to service that
    amount of tax debt, so basically destroying any chance of my
    sons continuing to farm the operation that has been in our
    family for close to 100 years.
        I know this is a lot to think about, but I want to leave
    you with this: The current tax provisions are essential to
    preserving family farms and farming throughout the United
    States. Protecting these policies is key to ensuring that we
    can pass our farms on to the next generation, because when we
    protect farming and farms, we protect our communities, we
    protect our food, and we protect our fuel, all things that have
    and will keep our country strong and keep the United States the
    envy of other nations.
        Thank you for this opportunity to provide this testimony
    today.
        And I do have one final request, and I know this is a big
    ask, but please, please, please, pass a farm bill this year. My
    dad----
        [Applause.]
        Ms. RIESSEN. So I come from a family of six kids and,
    needless to say, we fought a lot, and my dad would always say,
    You got to work along, you got to get along. My dad is 90 years
    old. He still farms.
        So I want you to take that advice back to D.C.: You got to
    work along and you got to get along. And I would certainly hope
    that we see some promise in getting that farm bill passed.
        And one more thing. You have a keychain there by you. You
    folks are the key to getting this farm bill passed, to getting
    these tax policies back on the farm for us. So please, I know
    that is kind of a corny gift, but it is so important the things
    that you folks will do for us out there.
        So thank you so much.
        [The statement of Ms. Riessen follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Chairman SMITH. Thank you. Amen to that. Let's pass that
    farm bill.
        Mr. Sukup, you are recognized.

          STATEMENT OF STEVE SUKUP, PRESIDENT AND CEO, SUKUP
                           MANUFACTURING CO.

        Mr. SUKUP. Thank you.
        Good morning, Chairman Smith, and all to the distinguished
    members joining us. Thank you for the opportunity to appear
    before you today at this important hearing. It is a special
    time in our community, and we are grateful to host you.
        My name is Steve Sukup. I am president and CEO of Sukup
    Manufacturing. We are located just south of Interstate 35 in
    Sheffield, Iowa. And I am proud to say that we are the largest
    family owned and operated manufacturer of grain storage,
    drying, and equipment.
        For over 60 years, Sukup has been a critical part of the
    U.S. food supply. We sell in every state represented here,
    throughout the Midwest and from California to New York. Our
    company is located in Congressman Feenstra's district, and I
    would like to thank him for being here today and our entire
    Iowa delegation.
        The tax reform bill of 2017 was a shot in the arm for
    manufacturers across our sector. Sukup has grown over the past
    decades, but nothing compares to the Tax Cuts and Jobs Act when
    it was signed into law. For example, thanks to lowering the
    corporate tax rate to 21 percent, Sukup grew our workforce by a
    third, adding 200 well-paying manufacturing jobs in our
    community.
        The key to Sukup's success has not only been our culture
    but our dedication to creating and pushing our industry
    forward. Sukup has held over 100 U.S. patents. We are
    pioneering ways to make grain storage and drying more safe,
    profitable, and efficient for farmers and ranchers across the
    country. This is largely made possible by massive investments
    in research and development.
        In the years following tax reform, Sukup increased our R&D
    investment by several million dollars, with 95 percent of that
    money going towards engineering and staff wages, bringing well-
    paying jobs to Iowa.
        One of these critical R&D investments is our safety homes.
    When a catastrophic earthquake struck Haiti in 2010, a Sukup
    safety manager wanted to develop an efficient, quickly
    assembled home from one of our grain bins to provide relief. I
    encouraged him to build a prototype. And today, our safety
    homes as you can see here on the fairgrounds today are changing
    lives worldwide.
        We also developed the world's largest 2.2 million bushel
    bin for ethanol plants. That is big enough to house a Boeing
    767. But, yes, the landing is difficult, even for you,
    Congressman Nunn.
        Unfortunately, after being part of our tax code for 70
    years, the expiration of immediate R&D expensing has made it
    harder for us to invest in the technologies and products of the
    future. Congress should immediately reinstate the expensing of
    R&D so manufacturers like Sukup can continue to innovate.
        Following the passage of the 2017 tax law, Sukup went from
    roughly $5 million in capital spending to almost $15 million
    per year, thanks to the 100 percent accelerated depreciation.
    This allowed us to fund new equipment purchases and fulfill our
    mission of providing Sukup employees with reliable, safe, and
    efficient equipment.
        Unfortunately, full expensing began to expire in 2023. We
    believe that was a mistake, and it is common sense that our Tax
    Code should encourage investment that leads to growth. Many
    manufacturing teams, including our company, would benefit from
    seeing this provision restored, and Congress should do it
    immediately.
        An accountant once told me, if you don't have some debt,
    that means you are not coming up with new ideas. Well, many
    manufacturers like us borrow moneys to finance essential long-
    term investments. Tax reform made it less expensive to take
    business loans which manufacturers use to invest and grow their
    operations. Unfortunately, this pro-growth standard expired in
    2022 as well, making debt financing much more expensive. We are
    also counting on you to preserve tax reform sensible changes to
    the estate tax, so that we can ensure the third and fourth
    generations of Sukups can continue in our family business.
        Discussing tax policy before Congress is something of a
    tradition in our family. About 20 years ago, my father, Eugene
    Sukup, testified before the Senate Finance Committee, along
    with Warren Buffett. Since then, thanks to tax reform, we have
    had incredible growth streak in our business, and every one of
    our employees and customers has benefited.
        I urge you to keep that growing streak going. Maintaining
    the 21 percent corporate rate, as well as the tax provisions I
    just described, are so important to manufacturers everywhere.
    Because of these policies, we have been able not only to
    maintain our business; to provide great living, health
    benefits, and soon expanded child care for our employees and in
    our community, even as we aid those in need around the globe.
        Again, thank you for being here today, and thank you for
    looking at ways to keep Sukup Manufacturing a rural Iowa
    success story.
        Thank you.
        [The statement of Mr. Sukup follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Chairman SMITH. Thank you.
        Ms. Pol, you are now recognized.

       STATEMENT OF LANA POL, OWNER AND PRESIDENT, GEETINGS, INC.

        Ms. POL. Good morning, Chairman Smith, members of the House
    Committee on Ways and Means, and members of the Iowa
    delegation. My name is Lana Pol, and I own a number of small
    businesses here in Iowa. My businesses are Geetings,
    Incorporated, a local and regional trucking company; G.I.
    Warehouse Corporation, which specializes in commercial
    warehousing and logistics; Creative Inspiration, an embroidery,
    promotional, and customer fulfillment company; Mowbility Sales
    and Service, an outdoor power equipment, trailer, and small
    tractor dealer; and Odyssey Spas, which sells hot tubs and
    provides services for pools and spas.
        I thank you for this opportunity to discuss how tax policy
    impacts small businesses like mine here in the Midwest.
        Entrepreneurship runs deep in my family. My father, Delroy
    ``Wayne'' Geetings, founded Geetings, Incorporated, in 1972 in
    Pella, Iowa. Three years later, he expanded his operations to
    nearby Knoxville with G.I. Warehouse Corporation. I joined his
    companies in 1975, and worked for many years with my family
    running these businesses.
        With the retirement of my brothers a few years ago, today I
    fully own these businesses and operate them with my children.
    My children share our family's passion for entrepreneurism, and
    I own and operate Mowbility Sales and Services, Odyssey Spas,
    and Creative Inspirations with them. It is my hope that each of
    these businesses will pass on to future generations in our
    family.
        While each of my businesses has their own purposes and
    their own unique challenges, they have all directly benefited
    from the policies in the 2017 Tax Cuts and Jobs Act, TCJA,
    aimed at growing small businesses, and they would each face
    challenges should these provisions expire. Today I would
    particularly like to focus on three provisions that are
    critical to our operations: the small business deduction, 199A,
    created under TCJA; the expansion of the bonus depreciation and
    small business expensing in TCJA; and the estate tax.
        Each of my businesses operate as a pass-through, that is,
    the business earnings flow through my individual tax returns.
    Like other pass-through companies, the small business deduction
    section, Section 199A, created in TCJA has provided multiple
    opportunities for me to reinvest and grow my businesses.
        Because of this deduction, I was able to give my employees
    the largest compensation increase that we have been able to
    provide in many years, which in turn has helped our efforts to
    retain employees, something that has not always been easy
    recently.
        Additionally, we were able to invest $2 million to build a
    nearly 40,000 square foot expansion of G.I. Warehouse
    Corporation and expand our fleet of trucks at Geetings.
        Our businesses have also benefited from the expansion of
    the expensing provision in TCJA. Under TCJA, full expensing for
    equipment could be recognized in the year of purchase instead
    of having to amortize costs over additional years through
    depreciation. This change allowed us to consistently add trucks
    and trailers to our fleet at Geetings, Incorporated. In fact,
    the first year of this expansion, we were able to purchase and
    immediately expense six new semi-trucks and, until recently, we
    have been able to continue this expansion.
        However, recently we have had to implement a freeze on
    purchasing any new equipment. This is due to the uncertainty of
    the tax provisions at the end of 2025 and because of the
    increased costs of equipment. In fact, in 2018, we purchased
    trucks for $158,000 each. In 2022, the trucks cost $251,000
    each. If these TCJA provisions were allowed to fully expire or
    otherwise be limited, it will create another hurdle to
    expanding our fleet in the future.
        Finally, like many family-owned businesses, the impact of
    the estate tax on a small business has become more real to me
    recently. My husband unexpectedly passed away earlier this
    year. At the time of passing, we were working on our estate
    planning, including succession planning for our family
    businesses. Each of my businesses is rooted in family
    operations. My hope for all of them is that they were not only
    passed on to my children but their children as well.
        While I agree with others that this tax should be
    eliminated entirely, if Congress does not at least act to
    preserve the expanded exemption of the estate tax under TCJA,
    it will be increasingly harder to pass family-owned businesses
    from generation to generation.
        If nothing else today, I want to stress to the committee
    that protecting small business is good for America. Small
    businesses are the foundation of the American economy.
        Without action, 30 million small businesses in the United
    States will be faced with a massive tax hike, which will hurt
    their ability to create jobs and give back to their
    communities. I urge Congress to act swiftly to provide small
    business with the certainty that they need to make these
    provisions permanent.
        Thank you for the opportunity to testify today. I look
    forward to answering any questions.
        [The statement of Ms. Pol follows:]
       [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Chairman SMITH. Thank you.
        I want to thank each one of our witnesses.
        We will now move to the question-and-answer portion.
        Mrs. Curry, as a mother of three young boys, very young
    boys, you know as well as anyone the joys but also the
    challenges that can come with raising kids. One policy that I
    have long championed is the Child Tax Credit. This pro-working
    family tax policy was created, I like to point out, by a
    Republican Congress back in 1997, and strengthened by a
    Republican Congress in the 2017 Trump tax cuts.
        Where the Trump tax cuts are set to expire at the end of
    next year, the Child Tax Credit will be slashed in half, from
    $2,000 to $1,000. And as a parent, what would that mean to your
    family, and what more should Congress consider doing with the
    Child Tax Credit to make it even more helpful to families like
    yours?
        Mrs. CURRY. I mean, every dollar that my husband and I earn
    that we get to keep goes towards our children. Like I said,
    Isaac, he is in speech therapy, occupational therapy. We are
    waiting for behavioral therapy. It is all very, very expensive.
    Health insurance doesn't cover everything. You know, Benjamin
    needed speech therapy because the little booger didn't want to
    talk when he turned two.
        So it is just, you know, expenses like that. You know, the
    water heater goes out. The furnace went out right after Phillip
    was born. And so looking at when we file our taxes, it happened
    early spring, and in Iowa it is still very cold then. So that
    was actually a really reprieve. You know, I didn't have to pay
    a whole lot extra in taxes. We got a little bit back, and it
    helped with that.
        So, you know, taxes affect my grocery bill. They affect my
    gas tank. They really, really do impact my kitchen table.
        So I would just ask, I mean, for nothing else, just keep it
    where it is at $2,000. An expansion would be very grateful,
    especially for those young children. Early intervention is new.
    It wasn't around when I was young. And so those services do
    cost more money. So maybe expanding it more for younger
    children versus older children would be an option to help. But,
    really, reducing it by any amount would negatively impact my
    family, my children, and really, specifically, our ability to
    pay for services.
        Chairman SMITH. Thank you.
        Ms. Riessen, as a family farmer, you know how important it
    is that your farming equipment is up to date. It is about
    delivering the best product to your customers and about keeping
    your employees safe. I know how important it is to make sure
    your equipment and tools are up to date and helping you get the
    most out of your land to deliver goods to market faster, more
    efficiently, and in greater yields. But this investment comes
    at a tremendous cost, which is why Congress included the
    immediate 100 percent expensing for machines and equipment in
    the Trump tax cuts back in 2017. However, that provision has
    already begun to phase out. It was 80 percent last year. It
    will be 60 percent this year, 40 percent next year, and then
    20.
        What has been the impact and what will the future look like
    for family farms like yours if Congress does not address this
    critical piece of the tax code?
        Ms. RIESSEN. So my first thought is, if you like to eat,
    you will help us with this. From my experience this spring, our
    combine last fall was having issues. We looked at it this
    spring. To fix it was going to be basically $80,000. The
    combine is worth $120,000. So guess what? We had to get a
    different combine. If I wanted a brand new one, which my boys
    thought should happen, that is $750,000, $750,000 for a 2025. I
    am, like, wow. That could buy me a tremendous retirement home.
    But I couldn't do that to the boys.
        So, anyway, ended up buying a $450,000 one. And so, you
    know, when you buy that piece of equipment, you are expected to
    pay it off in three to seven years. That is usually what the
    finance is at, so those are pretty hefty bills that come to
    play. So being able to use that 100 percent depreciation, now
    it just freed up money so I can make those payments. You know,
    people have 20 years--20, 30 years to buy a house. Nope. A
    piece of equipment that is worth more than what a house is I
    got to pay off in three to five years, three to maybe seven if
    you talk well to your banker.
        So by having that, it allows me to make improvements on my
    farm to which--okay. So I kind of liken it to a cell phone. How
    many have a flip phone or a bag phone anymore? We want new
    technology. We need new technology on our farms in order to
    continue to be competitive out there. And by being able to use
    this, we are staying in the ball game.
        Chairman SMITH. So, Mr. Sukup, we know that sound tax
    policy can help America's businesses grow and innovate. We see
    the spirit of innovation every day from American manufacturers
    to our family farmers. America's farmers are some of the best
    innovators in the world as they are consistently researching
    ways to get more out of their land for today and future
    generations of farmers.
        In the 2017 Trump tax cuts, it sparked an 18 percent
    increase in investment in research and development in this
    country. As a business owner, what impact did the 2017 tax cuts
    have on your decision-making, and what would the current lapse
    in the ability to immediately expense R&D investment have meant
    to your capabilities to invest, innovate, or grow?
        Mr. SUKUP. Well, going back to 2017, we then switched to
    where we were doing about $5 million a year in research and
    development. We then started increasing that. We went up to $15
    million. And what that did was reinvest in machinery. We are
    manufacturing. So it is very heavy, capital-intensive
    equipment, but it provides our employees to be more safe and
    efficient and provide us to be able to put better products to
    our customers across the Midwest, across the world.
        And, also, with the lower tax rate, that was when we
    started a clinic, actually, in our manufacturing plant
    facility. Our third generation, my daughter, Emily, came up and
    said--worked with some of our H.R. folks and said our employees
    would really like this. Well, we reinvested into our employees.
    It has been a perfect fit for us for the clinic onsite. We are
    doing child care because that is so important to families
    throughout our community and for us to have them have a safe
    environment for their kids, but also to be able to come in and
    work at Sukup at the manufacturing jobs.
        Chairman SMITH. Ms. Pol, as an owner of four small
    businesses--small businesses are the foundation of our
    country's economy--you know how difficult it can be for Main
    Street businesses to compete with larger corporations who are
    taxed at a lower rate rather than as a so-called pass-through
    entity.
        Here in Iowa, pass-through businesses account for nearly
    half of all employment in the State. Across the U.S., 98
    percent of our family farms, which account for more than 90
    percent of our agriculture production, are also pass-through
    entities.
        What would it mean for your business if the 20 percent
    small business deduction that was included in the Trump tax
    cuts were to expire and you face an effective tax rate of over
    43.4 percent while the company Mrs. Dewalt works for pays 21
    percent?
        Ms. POL. That would be just devastating. You know, large
    companies also have so many other advantages that we don't
    have. You know, they also have the ability to make more money
    than we do. So when we get hit with these large tax increases,
    and it is unfair for small businesses to have so much more than
    they do, so it takes that money out of our pocket, and it takes
    it so we can't reinvest. We can't give raises. We have to
    compete against large companies for our employees. And so it is
    not always as easy to pay the wages that they can, have the
    benefits that they can. So we have used that benefit to give
    the wages. And so if it gets taken away, I think it is going to
    be harder and harder for us to be able to compete.
        Chairman SMITH. Thank you.
        Mrs. Dewalt, during the Obama administration, prior to
    enactment of the 2017 Trump tax cuts, we saw over 25 major
    corporate inversions occur where businesses moved their
    headquarters and jobs overseas to fly the flag of another
    country. The Trump tax cuts made several changes to make it
    more competitive for U.S. businesses to be located and do
    business here in the United States.
        Can you talk specifically about some of those changes and
    how they can impact the decisions by U.S. businesses to keep
    their operations here in the U.S.?
        Mrs. DEWALT. Thank you for the question, Chairman Smith.
        So the corporate rate prior to TCJA was uncompetitive on a
    global scale. So the reduction certainly encourages businesses
    to invest in the U.S. So at The Home Depot we are predominantly
    domestic, and the reduction of the corporate tax rate to 21
    percent enabled us to make significant investments: investments
    in wage of $2 billion, permanent investments in wage of $2
    billion, enhancing our supply chain $1.2 billion, 18,000 jobs.
        So in our business decision-making, we factor in the
    corporate rate and other factors when we make all of our
    decisions about pricing, about wage, about expansion, and other
    investments. It is key to have a competitive 21 percent rate in
    the United States for companies like ours to continue this
    level of investment.
        Chairman SMITH. Thank you.
        I now recognize Mr. Feenstra.
        Mr. FEENSTRA. Thank you.
        And thank you again to all the witnesses.
        You know, you think about tax, and if you reduce tax, you
    give families, businesses more money to do different things. We
    just heard about that. What it also does, it increases revenue
    to our country. Yeah, it is a shocker.
        In 2017, under the Tax Cuts and Jobs Act, we dramatically
    reduced taxes. And you know what happened? It grew our economy
    and we brought in record number of revenue. What does that do?
    That will help us reduce our debt, our $35 trillion debt, if we
    continue to grow. That is why I am so passionate about it.
        The other thing I am passionate about is tax inequity.
    There is a lot of tax inequity. One specific one is the death
    tax, estate tax. We got rid of it in the state of Iowa. I was a
    big proponent of that. But we haven't got rid of it at the
    federal government level.
        I have 170-some Members that have signed on to my bill to
    rid of the death tax. It is a pilfer tax. Think about it this
    way: You collect all this land throughout your life. You die,
    and all of a sudden your family member has got to pay 42
    percent tax on that land. Think about that, 42 percent. That is
    wrong in so many ways.
        So, Mr. Sukup, I want to ask you, you are talking about the
    third and fourth generation coming down the pipe. How will this
    affect you if you have to pay that 42 percent?
        Mr. SUKUP. We wouldn't be able to pass it on. Right now, I
    am part of the second generation, my brother and I. Our third
    generation is in the office every day. We have six members of
    our third generation. They enjoy coming to Sheffield every day
    and working throughout the different jobs of our manufacturing.
    But to be able to pass it on, that would just be overwhelming
    and not possible.
        Mr. FEENSTRA. It would just be a killer, absolutely. And
    all of a sudden, that next generation is lost.
        Mr. SUKUP. And that family business closes or leaves the
    community.
        Mr. FEENSTRA. That is exactly right. And that happens to
    small businesses and our main streets day and day--day and time
    and time again.
        I want to talk about something else that is so important to
    Iowa. You think about, right now, over 50 percent of our crop,
    corn and soybeans, goes to biofuels. Every other row virtually
    goes to biofuels.
        Right now, if you look at our commodity prices, our corn is
    under $4. Our soybeans are under $10. Right? Now, we could
    export more or we could use more of it. How do you use more?
    You do it through biofuels, ethanol and biodiesel. To do that,
    we have got to grow our market through sustainable aviation
    fuels and other things.
        So I want to talk about 45Z. All right. This is a tax
    credit that can dramatically expand these markets and, in
    essence, put us on the same foothold as electric vehicles.
    Right now, we have a thumb on the scale for electric vehicles
    and not liquid fuels. This gives us an opportunity to compete.
    And if we don't, we are going to probably see our commodity
    prices cut nearly in half again.
        Ms. Riessen, can you talk about this?
        Ms. RIESSEN. You bet. So that 45Z is going to be a game
    changer for us out there when it comes to the grain price,
    because with the 45Z the Nation and our domestic consumers are
    asking for low carbon. So one way of doing that is through
    carbon sequestration, and this 45Z helps ethanol plants get set
    up to be able to do that.
        So when we do that, my corn that goes to that ethanol plant
    now, I am not expecting to get a lot of corn--I mean, a lot of
    any tax return back from that, but what it does is make
    markets, and it makes better prices. But the only way that is
    going to happen is if we specifically say that we use the corn
    that is produced domestically. Because at this point in time,
    our friends down in Brazil are importing their ethanol into
    Georgia to make sustainable aviation fuels, and my
    understanding is they will qualify for this tax cut, this 45Z.
    We can't let that happen. I am sorry. I mean, I love all
    farmers, but not that much.
        Mr. FEENSTRA. We need to use domestic feedstock. We can't
    use stock from around the world.
        Ms. RIESSEN. Right. And so in a recent study I just saw is,
    so for every dollar invested in that 45Z tax credit, it will
    return $4 to $6 for every dollar invested. So I am like, you
    know what, I am sorry, I think this is a no-brainer, but you
    got to take it back to Congress and get that happening.
        Mr. FEENSTRA. Thank you for that.
        I just want to tell everybody, we have to remind ourselves
    that when our farmers are successful, our main streets are
    successful, our hospitals, our schools, everything is
    successful. And when our commodity prices are where they are
    at--and we are going to feel it this fall, all right--no one is
    going to buy a vehicle, a piece of equipment or a bin,
    whatever, that is why it is so important that we have 45Z and
    make sure we have that bill.
        Ms. RIESSEN. Right.
        Mr. FEENSTRA. I yield back. My time is up.
        Thank you.
        Chairman SMITH. Thank you.
        Mrs. Hinson is recognized.
        Mrs. HINSON. Thank you, Mr. Chairman.
        I want to talk a little bit more about something that has
    already been discussed today, and that is the Child Tax Credit
    and the expansion of that under the 2017 Trump tax cuts.
    Doubled the tax credit, increased its refundability, and raised
    that income threshold. And all that does is it makes it so that
    more families, more hardworking Iowa families and American
    families can access that credit.
        So building on that foundation, I actually introduced a
    package of bills called the Providing for Life Act. It really
    prioritizes the needs of our families and ensures that they
    have the resources to thrive. It would expand the Child Tax
    Credit, include provisions for paid family leave, support for
    expecting parents and pregnancy centers, and it would
    specifically increase the refundable Child Tax Credit up to
    $3,500 for kids under the age of 18 and $4,500 for kids under
    the age of six, also expanding the credit to unborn babies
    during a woman's pregnancy.
        So in addition to that, it would also make the adoption tax
    credit fully refundable. This would help people like my
    colleague, Mr. Nunn, over here who have taken it upon
    themselves to adopt children and expand their families. Kids
    deserve to have a loving, happy family, and this can help with
    that.
        So by broadening access to these benefits in the Tax Cuts
    and Jobs Act and then legislation like what I proposed, it
    would help to reduce child poverty. It would alleviate
    financial pressure on real working families who often face
    these unique challenges, such as limited job opportunities,
    longer commutes, and higher costs for those essential services.
        So, Mrs. Curry, I just wanted to ask you, you know, when
    you hear about the expansions that I just talked about, even
    above and beyond the Child Tax Credit, would those resources,
    and having conversations with your neighbors in rural America,
    really help families like yours?
        Mrs. CURRY. Thank you for the question.
        Yes, the expansion of the Child Tax Credit would, without a
    doubt, help myself and my neighbors and others. You know, being
    a part of the autism community, I know a lot of families that
    are also struggling and constantly looking for support or
    different services. And they are not cheap, let me tell you,
    but, you know, they are our kids. You can't say no. It is what
    they need to be fully functioning adults one day and to, you
    know, really just exist in society. So expanding that for young
    children, I think that is so valuable.
        I can't tell you the number of doctors appointments we have
    gone to for a heart murmur or, you know, having to find a
    specialist pediatric ophthalmologist because we didn't know,
    you know, if they were seeing well. And so all of those
    expenses, right, and parents are just trying to do the best job
    they can for their kids. And it is expensive, and it is getting
    more and more expensive.
        I can tell you, when I go to Sam's Club to buy chicken
    nuggets and fruit for my kids, the price just keeps going up
    and up and up. And, you know, I buy milk three gallons at a
    time, and it is getting more and more expensive.
        So, again, expanding that Child Tax Credit would help
    families like mine and really help, like, our kitchen table.
        Mrs. HINSON. Yeah. I have a 13-year-old now, so we feel you
    on the personal level. I had no idea how much 13-year-old boys
    eat. It is really gross to watch them eat sometimes. But
    certainly feel that in my grocery bill, and I am sure, much
    like you, I see those expenses tack up, tack up, tack up and
    add up.
        So I want to move to domestic manufacturing because,
    obviously, that is such an important part of our rural economy
    here. And we have seen and heard already about the investments
    in businesses creating those jobs right here in rural America.
    And our foreign adversaries, like China, continue to ramp up
    their investment in work and research to gain control of our
    critical supply chains. So I think it has never been more
    important for Congress to really commit to pro-growth policies
    that help American leadership on the global stage.
        So getting to that investment, Mr. Sukup, as a business
    owner, can you speak to the importance of this tax policy that
    keeps us competitive not just here at home but on that world
    stage? Because you sell your equipment all over the world, so
    you see those impacts day to day.
        Mr. SUKUP. Yes. We export containers every week out of our
    company. It goes across the globe. Being able to have the--
    whether it is the depreciation or the lower tax rate lets us
    reinvest into our manufacturing. And I think over the last 4
    years with COVID and everything, you have seen how important
    manufacturing and domestic manufacturing is. And so this Tax
    Cuts and Jobs Act is just critical for us to continue with that
    aggressive mode.
        Mrs. HINSON. So if these cuts are allowed to expire--and
    you have talked about a lot of the growth you have
    experienced--that will mean some hard decision-making for you
    and your family?
        Mr. SUKUP. Yes. No, there would be some pullback. So far,
    our markets have stayed strong and, you know, we have added 200
    well-paying manufacturing jobs, and our intent is to keep
    everybody busy.
        Mrs. HINSON. Yeah. Well, you are certainly doing a great
    job of that. So thank so much for coming today.
        And, Mr. Chairman, I yield back.
        Chairman SMITH. Thank you.
        It is great to have Dr. Miller-Meeks with us. We will
    recognize you for an opening statement and for your questions.
        Mrs. MILLER-MEEKS. Thank you very much, Chairman Smith and
    the Ways and Means Committee, for holding this incredibly
    important hearing here today in the heartland of America in
    Iowa, at the greatest state fair in the country, the Iowa State
    Fair.
        And I also want to thank our five witnesses for taking the
    time to be here. You represent the best of America, real people
    facing real problems asking for real solutions.
        The 2017 Tax Cuts and Jobs Act significantly transformed
    the American economy, fostering an environment that stimulated
    growth and improved the financial well-being of millions of
    Americans. The Tax Cuts and Jobs Act provided much needed
    relief for families by lowering Federal tax rates across all
    income levels. As a result, low- and middle-income households
    experienced an increase in disposable income, enabling them to
    invest in their homes, save for education, and enhance their
    quality of life.
        Businesses of all sizes were also major beneficiaries of
    the TCJA. With lower tax rates, companies had more resources to
    invest in research and development, infrastructure, and
    workforce training. As companies reinvested in their
    operations, productivity increased, and wages rose for American
    earners.
        And as the chair of the Conservative Climate Caucus, Ms.
    Riessen, your comments on the equipment that you can buy, if
    you are concerned about climate, as our colleagues on the other
    side of the aisle who are not here today, you would want
    farmers to be able to invest in the most up-to-date equipment
    that leads to precision agriculture and less inputs.
        The 2017 Tax Cuts and Jobs Act catalyzed a period of
    economic growth and opportunity for families, small businesses,
    and corporations alike. By lowering tax rates and encouraging
    investments, the TCJA not only enhanced financial security for
    millions of Americans but also positioned the United States
    economy for long-term success.
        In conclusion, the expiration of the 2017 Trump tax cuts
    would not only impose significant tax increases on middle-class
    families but also hinder economic growth and stability. It
    would disproportionately impact small businesses, lead to job
    losses, and diminish the competitive position of American
    companies in the global market, as Representative Hinson
    alluded to.
        As we look toward a future of economic recovery and growth
    at a time when commodity prices are low, at a time when the
    national debt is high, it is critical that Congress act to
    extend and protect these vital tax policies, ensuring that
    American families, workers, and small businesses can thrive.
    The success of our economy, and indeed our nation, relies on a
    tax framework that promotes investment, encourages job
    creation, and promotes financial security for all Americans.
        Thank you.
        Mrs. MILLER-MEEKS. Mrs. Curry, thank you for being here
    with us today. I understand that you had your first child back
    around the same time that the Child Tax Credit was doubled from
    $1,000 to $2,000 under the Trump tax cuts. And like
    Representative Hinson, I also have signed on to legislation
    that would extend the Child Tax Credit during pregnancy.
        As a mom of three here in Iowa, can you describe to us the
    impact that the child care tax credit after 2017 had on you and
    your family?
        Mrs. CURRY. Yes. The impact the Child Tax Credit had on me
    after the birth of my first son, in that first year, we had the
    smaller amount, and so we owed additional taxes when we filed.
    And so we definitely felt the pinch there, new parents and
    having additional taxes due.
        The following year was the first year in a long time we got
    a refund, and it was a welcome kind of breath of fresh air. We
    didn't have to stress so much.
        So, yes, the expansion of the Child Tax Credit had an
    immediate impact, noticeable impact on my family.
        Mrs. MILLER-MEEKS. Thank you.
        Unfortunately, that provision is set to expire at the end
    of 2025, which would cut the child care tax credit in half,
    impacting millions of working families across the country who
    depend on the Child Tax Credit to help support their children.
    And I think you have elucidated well what the impact would be,
    especially when you are commuting in rural Iowa to jobs.
        Ms. Pol, you are from my district, the beautiful city of
    Pella. Thank you for being here with us today.
        What are some of the challenges that you face running a
    small family-owned business here in Iowa? And what tax
    provisions have helped relieve some of those challenges?
        Ms. POL. I think our largest challenge is the low
    unemployment that is here in Iowa. To get qualified workers, we
    are constantly competing against large businesses, and we don't
    always have the opportunity to be able to pay the same wages,
    have the same benefits that they do.
        So we were able to take the 20 percent deduction and give
    large raises to our employees. We added a few more benefits to
    them, and we also were able to add to our starting wage. So it
    allows us to be more competitive. And coming from Pella, Iowa,
    that has Pella Corporation, Vermeer Manufacturing, neighboring
    3M in Knoxville, and Hormel, we compete against a lot of large
    businesses for a small area.
        Mrs. MILLER-MEEKS. I think the Trump tax cuts, as you said,
    created the 20 percent small business deduction that benefited
    Main Street businesses such as yourself across America and in
    small communities. However, the Biden-Harris administration has
    all but said that they would let this provision expire after
    2025, increasing Main Street's effective rate to 43.4 percent.
    And I think as you indicated, in order for small businesses and
    entrepreneurs to exist in our country, which is the backbone of
    the American economy, we need to have those provisions in
    place.
        And can you talk to us a little bit more about the removal
    of the small business deduction, what it would mean for your
    family business?
        Ms. POL. Right now, especially with the economy the way it
    is and with inflation the way it is, we are getting hit from
    all sides, whether it is increases in equipment, increases in
    parts, increases in labor costs. Warehouses have gone up and
    almost doubled to buy and build a new warehouse at this point.
    So now we are getting increases also in the insurance costs for
    that because we do replacement costs on it. So every place that
    we look at we are getting increases. Property taxes. And by
    having this--if this increases too, we are going to have to
    look really, really hard at, you know, how we are going to be
    able to make it through the next while.
        Mrs. MILLER-MEEKS. It is difficult when you are getting hit
    on all sides and your federal government isn't helping to
    prevent it.
        Ms. Riessen, can you explain how the option of using bonus
    depreciation to modernize equipment has affected the
    productivity and efficiency of your farm and your ability to
    plan for future growth and expansion?
        Ms. RIESSEN. So my two boys who are currently farming with
    me--I lost my husband 5 years ago to cancer. And so this bonus
    depreciation, the death tax, stepped-up basis are all--I have
    lived it, and I am telling you right now that by losing that,
    you are decimating the next generation of farmers coming down
    the tubes.
        But to get to your depreciation part of it, by being able
    to upgrade equipment--so the combine I was talking to you about
    this year that, you know, would be great to live in if I could,
    but--anyway, so it is going to have the GPSing. It is going to
    have--it will have the ability to communicate with the other
    combine so that when it comes time for, say, you are in a super
    big field and you are not sure if you have got everything done,
    it will tell you where there are areas at that have to be
    farmed yet. So then instead of driving from one side of the
    farm to the other because you forgot a strip out there, it
    takes care of that. So I am saving fuel, and that is reducing
    my carbon emissions because the new equipment is way more
    effective as far as for, you know, the emissions part and the
    mapping, and the list goes on.
        So I say to me it is like, you know, am I going to use a
    bag phone out there to harvest or am I going to use the best
    iPhone possible in order to do my job as quickly and as
    efficiently as possible.
        Mrs. MILLER-MEEKS. And very briefly, because I am over
    time, does that also apply to the 199A small business
    deduction----
        Ms. RIESSEN. Oh, yeah. Oh, yeah.
        Mrs. MILLER-MEEKS. Thank you. I yield back.
        Chairman SMITH. Thank you.
        Mr. Nunn is recognized.
        Mr. NUNN. Thank you, Chairman Smith.
        Thank you again for the group for being here today and
    offering real Iowa common sense on how a tax policy not only
    helps grow an economy but helps everyday working families.
        So, Mrs. Curry, as not only a fellow Iowan, but here in the
    district together, and of all the titles you have, with the
    family farm, working a nonprofit, leading advocacy for kids
    with autism, I think your best title is probably mom. And the
    reality is here, you know, you are reflective of 30 percent of
    Iowans who benefit from this tax credit. Look, almost half a
    million Iowans qualify for it, and it doubles their ability to
    have savings.
        I want to ask you, you know, when you got that tax credit,
    that money back in your pocket, did you go out and buy an
    Italian-made Ferrari?
        Mrs. CURRY. No. No, sir, I did not.
        Mr. NUNN. Did you hostilely take over a foreign entity,
    build it offshore?
        Mrs. CURRY. No.
        Mr. NUNN. What did you do with your tax credit, because you
    are reflective of a working-class family, to be able to help
    your kids?
        Mrs. CURRY. We paid our speech therapist, and we took Isaac
    to a specialist eye doctor, and we bought a new water heater
    that spring.
        Mr. NUNN. Mr. Chairman, that is a real investment back in
    our economy here. Most important, it is a real investment in
    our families' and our kids' future. That is exactly what this
    tax credit is meant to do, and it is so very important that we
    continue to extend it into the future.
        It is one of the reasons I am proud to be leading the
    Keeping Siblings Act together as parents, also as a foster dad,
    which I share with Mr. Smith here on the committee as well, and
    as foster parents, being able to help those generation of kids
    be successful, hugely important for our future.
        Thank you, Mrs. Curry, for everything you do.
        Ms. Pol, I want to talk with you as well. Look, you are a
    small business owner. Iowa is home to over 270,000 small
    businesses. In fact, here in Iowa, we have an outsized voice.
    Ninety-nine percent of businesses in Iowa are identified as
    small businesses. Being able to really help make this up is
    huge.
        Now, if these tax credits expire, 92 percent of Main Street
    businesses in Iowa would experience a 43 percent-plus tax
    increase. I think it is fair to say that would decimate a lot
    of our small towns and communities, not just here in Iowa,
    across the country.
        Would you be able to keep your supply chain going if you
    had tax increases like this levied on your door
    instantaneously?
        Ms. POL. I think it is going to be tough. You know, I am
    scared what is going to happen if it does expire, because I
    have seen small businesses already closing in Iowa, you know,
    especially in the restaurant industry, unfortunately. And with
    everything that is happening and the cost of everything, with
    inflation, we are getting hit so hard the way it is, and then
    if we are going to be paying these kind of increases--we have
    had a really rough two years across the board with my
    businesses, so we are already hurting. So with this happening,
    it could be devastating to us and across the board for Iowa and
    the United States.
        Mr. NUNN. And, Ms. Pol, I think you are absolutely right
    here. You talk about rippling effects. An increase in your
    trucking business means an increase for everyone in America
    with a supply chain that costs a lot more if you are paying
    more taxes.
        Tell me the opposite. If we are able to extend the tax cut,
    how does that help out bringing down prices for every American?
        Ms. POL. Well, that is great because we can continue to
    invest, you know, and we do. You know, the money doesn't come
    back into our pockets.
        Mr. NUNN. That is right.
        Ms. POL. You know, as small business owners, we reinvest.
    We reinvest in the communities. We reinvest in our employees.
    And that is the thing we will continue to do.
        Mr. NUNN. Well, and that is one of the reasons I am proud
    to support the Main Street Tax Certainty Act. It is one of the
    things we have done to make this permanent so you have
    permanency in your reinvestment here in our communities and
    growing across the country.
        Ms. Riessen--I should just call you Farmer Riessen. You
    know, you have been working with us so hard to highlight the
    success of an investment in America's ag, America's energy,
    America's national security. You are a practitioner in this.
        Look, the 2017 tax cuts offered us an explosive growth
    opportunity for reinvestment. It also increased U.S. investment
    by 20 percent and provided a crucial death tax exemption,
    something that we want to make sure we see increased.
        Talk to me about how your family farm is investing in these
    new innovations. Things like sustainable aviation fuel, 45Z tax
    credit, it is helping us grow our domestic energy production.
    Are these tax credits really the innovation of the future that
    you are using on the farm?
        Ms. RIESSEN. Oh, holy cow, I can't believe you are even
    asking me that. For me, that is a no-brainer. I mean, as a
    farmer, when I am getting tax breaks to help invest in markets
    and to invest in trade, when I have trade, I have security in
    my market. I have better markets because more people are
    competing for what I am growing. So, you know, just thinking as
    a farmer, so every dollar I spend in the community now it gets
    rolled six times, so----
        Mr. NUNN. Yes, we agree with you.
        Ms. RIESSEN. So it is like--so the people that I touch with
    what I am doing for, you know, the farming sector of it, it is
    huge. So just know that any money that--you know, everybody
    likes less tax, and so any money that we do manage to save gets
    invested right back into equipment or maintenance or whatever
    else happens to come up. You know, we have livestock and so----
        Mr. NUNN [continuing]. That is right.
        Ms. RIESSEN [continuing]. We have way more equipment,
    probably, than anybody else does in the countryside, but----
        Mr. NUNN. Thank you, Ms. Riessen.
        Ms. RIESSEN. So thank you.
        Mr. NUNN. These are not just tax credits. These are tax
    investments. As you say, every dollar invested is multiple
    dollars returned.
        Thank you, Mr. Chair. I yield my time.
        Chairman SMITH. Thank you.
        Mr. Smith is recognized.
        Mr. SMITH of Nebraska. Thank you, Mr. Chairman.
        Thank you to our entire panel and everyone participating
    here today. It is great to see the entire Iowa delegation here.
    It doesn't surprise me because they show up, and it is great to
    work together on things like biofuels where we can stick
    together. I happen to be from Nebraska, where we have a few
    biofuels and other similar industries in Nebraska. But we work
    together, and I think that is important. And we take from you
    your perspectives and apply them.
        And I am grateful to have been a part of passing the
    original Tax Cuts and Jobs Act and the work and the diligence
    that went into that when we happened to have votes in 2017. We
    started working on that long before we had the votes, and I
    think it is important to note that the diligence we are doing
    right now this very moment, thanks to our chairman here
    scheduling meetings, gatherings such as this, is hearing from
    you as we move forward.
        Now, I think it is important to note that TCJA is a very
    successful tool for growing our economy. I am glad we did that
    before COVID and the disruption in supply chains and various
    dynamics.
        I am also grateful when we can hear from a company that
    pays more in taxes than they did before and they are happy
    about it because they have the ability to pay that. And that
    might be a company, that might be individuals as well. But I
    think it is our job to hear from you and to dig down, to look
    for those details so that we can, hopefully, help form the
    future for more opportunity for future generations and pay down
    this debt that our country has accumulated.
        And so, you know, in the runup to 2017 tax reform, it is
    important to note that even Barack Obama realized we were not
    competitive on the corporate side. We were losing--as the
    chairman pointed out, we were losing American companies, strong
    American companies to relocation to other tax jurisdiction
    because it was more favorable. A very logical move, by the way.
    And even Barack Obama, like I said, noticed that we needed to
    be more competitive.
        And now he endorsed a lower corporate rate, and we wanted
    to be very certain that we would be very competitive, and that
    is why we chose the 21 percent rate as low as we possibly could
    and still have the resources for family credits and standard
    deduction--doubling the standard deduction, various components
    here.
        But I think it is very compelling when we hear from folks
    who are paying more in taxes now than they were before and they
    are happy about it, and it is instructive moving forward.
        But, Mrs. Dewalt, I guess it is only appropriate that you
    are with The Home Depot with a last name like Dewalt, right?
        Mrs. DEWALT. Coincidence.
        Mr. SMITH of Nebraska. It is coincidence. No advertising
    there.
        Can you elaborate a little bit on, you know, the corporate
    rate--which happens to be paid by some small corporations too,
    by the way. It is not just large corporations. But I am glad
    that you have the footprint that you do. I would imagine some
    younger folks showing cattle out here at the State Fair
    probably paid your stores a few visits over time.
        But can you elaborate on what you did with that 21 percent
    rate, you know, those differences? You spoke a little bit about
    it in your opening, but can you tell us with even more detail
    how you handled that 21 percent rate?
        Mrs. DEWALT. Sure. So as I mentioned, our business model
    has a number of inputs, factors that we consider in investing.
    And so the decrease in the corporate rate that was 35 down to
    21 created an opportunity for us to really focus, double-down
    on investing in our business. And we did so with our supply
    chain expansion, which increased our footprint, created jobs,
    and helps us to better serve our customers.
        We also took care of our associates, which is one of our
    core values at Home Depot. So we increased wages by a billion
    dollars, permanent wage increase in 2021, and then a second
    billion dollar wage increase announced last year. Those are
    permanent, not bonuses, but wage increases.
        We also just completed an acquisition of SRS Distribution,
    which is a wholesale distributor of building materials,
    primarily roofing, and that is really going to accelerate how
    we serve our pro customers.
        And so small businesses are essential partners to The Home
    Depot. So they serve us as suppliers. I talked about the 80
    suppliers, you know, here in this State. And they also make up
    a large portion of our pro customers, which is a very big part
    of our business, and it is growing. And our ability to be
    competitive with price, to have the materials when and where
    the pro customer needs them is really helping them better
    manage their businesses as well. And so we see the business
    community, corporate and small business, as the ecosystem that
    drives the economy.
        Mr. SMITH of Nebraska. Very good. Thank you.
        I wish I had more time because I have a lot more questions.
    But thank you again for being here, very appropriate topic in
    an appropriate place.
        Thank you.
        Chairman SMITH. Mr. Schweikert.
        Mr. SCHWEIKERT. Thank you, Mr. Chairman.
        And I appreciate, you know, being someone--I am from the
    desert. I am from a place called Scottsdale, and I saw more
    green in the bus ride here than I think I have seen in my
    entire State. And they were complaining it was hot yesterday. I
    am going, it is 116 at home.
        We have some real difficult decisions we have to work
    through over the next year. The fact of the matter is today,
    100 percent of defense of the United States is borrowed money.
    One hundred percent of government, as you know it, is borrowed
    money, all--Park Service, everything is all borrowed. And
    about--I was just doing the math--37 percent of Medicare is on
    borrowed money. This year, our income taxes, 45 percent of it
    will just pay the interest. Interest is now the second biggest
    spend in the United States.
        We need you to grow like crazy, and then we need to find a
    number of things where we are going to stop spending or do it
    better, faster, cheaper, adopt technology. And there is
    technology to crash the price of healthcare, because healthcare
    is the primary driver of U.S. debt.
        And, Mr. Sukup, you actually hit a couple of things that I
    really wish we would understand: the investment in research and
    development, the ability to expense a piece of equipment so you
    do it better, faster, and safer. You are one of the few people
    I have ever had use that word, ``safer.''
        Tell me your experience of, in those years where you had
    that expensing and the R&D credits--which is just a
    depreciation. It is not a tax cut. It would just move up the
    depreciation--how did it change your business?
        Mr. SUKUP. Well, we were able to incentivize our engineers,
    staff. We hired individuals to reinvest, research and
    development, take a look at what we could do better and faster,
    more efficiently for products for our farmers and ranchers
    across the country. We take that research and development, put
    it into action, and then it provides us some predictability in
    the tax----
        Mr. SCHWEIKERT. But did you produce--in that investment in
    your research and development, did you come up with faster ways
    or better or safer pieces of equipment that sort of leaped your
    company forward in those couple of years that you had 100
    percent of it?
        Mr. SUKUP. Yes. We have developed new grain dryers that we
    use across the country. We actually have some going into
    pistachios----
        Mr. SCHWEIKERT. Forgive me for--you'll later on explain
    what a grain dryer is?
        Mr. SMITH of Nebraska. Oh, yes.
        Mr. SCHWEIKERT. Okay.
        Mr. SUKUP. We actually dry pistachios, California and
    Arizona.
        Mr. SCHWEIKERT. Yes.
        Mr. SUKUP. And so we use those. And they are looking for
    high efficiency, to reduce the carbon outputs. We look at our
    carbon footprint. And so it is going to provide better products
    across the Midwest. We have to compete globally. We do that in
    manufacturing.
        When we invest capital equipment with the accelerated
    depreciation, what has to go along with the equipment? Skilled
    workers. We bring in skilled manufacturing jobs. And so we are
    able to grow and expand.
        Mr. SCHWEIKERT. Mrs. Dewalt, and so you are my reason the
    DeWalts were always on sale, right? I just noticed that last
    month.
        You have spoken of--and I couldn't find it real quick how
    tax reform happens. There are a number of us on this committee
    that know it doesn't just happen. It took years of calculating
    the money and trying to get the economic effects and what would
    maximize opportunity. And it turns out the tax receipts that
    came in afterwards were dramatically higher than we ever
    expected in our models.
        How much for Home Depot do you believe of that--moving to
    the 21 percent rate, how much of it moved into wages, both in
    the raised wages and the new hires? Would you speculate to
    guess?
        Mrs. DEWALT. Thank you for the question.
        What I can say about wages is that, with the reduction of
    the rate to 21 percent, obviously we have more capital to
    invest. And so our wages have increased higher than wage
    inflation. So we have been able to stay ahead of our wage
    increases to our associates, and now our associates are at or
    above $15 an hour across our stores.
        Chairman SCHWEIKERT. Thank you, Mrs. Dewalt.
        Mr. Chairman, I will try to find the study, but I had a
    study last year that showed, and I think--and I am doing it
    from memory--67 percent of the corporate tax cut went to wages.
    And with your permission, I would like to enter that into the
    record.
        And with that, I yield back.
        Chairman SMITH. So ordered.
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        Chairman SMITH. Mr. LaHood.
        Mr. LaHOOD. Thank you, Mr. Chairman.
        I want to thank our witnesses for your valuable testimony
    today. I also want to thank our friends from Iowa for issuing
    us a visa to come to your state and be here and participate in
    the Iowa State Fair. What a great opportunity to be here. I
    actually went to college in Iowa for 4 years, and it is great
    to be back. First time at the Iowa State Fair, and so really,
    really grateful for the opportunity to be here with everybody.
        And my district is contiguous to Iowa. I share a border
    with Congresswoman Miller-Meeks and also with Ashley Hinson. My
    district is very similar to the districts here in Iowa, heavy
    ag district. It is the tenth largest ag district in the country
    in terms of corn and soybean production. I have eight ethanol
    plants that touch my district. We produce a lot of cattle and
    hogs in our district, and are very involved in the biofuels
    conversation too. And so it is great to be here.
        And I would just--as I listen to the witnesses here today
    and hear you articulate the benefits from TCJA, nobody can do
    it I think better than how you guys have done it, whether it is
    a large corporation, whether it is a working family, whether it
    is a small farming operation, a small business, medium-size
    business, and an entrepreneur.
        As you have articulated what TCJA has done for you, I think
    it is remarkable, and that is why we are doing these field
    hearings all across the country, to hear from regular people on
    what TCJA has done. And as you articulated those things, I
    thought about everything that we have done with TCJA: reduced
    taxes, put more money in the pockets of middle-class and lower-
    class citizens, created millions of new jobs, hired more
    people, moved 6 million people out of poverty when we passed
    TCJA. We repatriated almost $3 trillion back to the United
    States with TCJA. And the investment that we have seen in small
    and medium and large businesses has been immense across the
    country.
        And so as I think about TCJA, it may be, in my 8 years in
    Congress, the vote that we took on TCJA may be the most
    impactful vote that I have taken. And I am so grateful to hear
    you today articulate all of those things on why we need to be
    focused on this next year for the economy and for our
    citizenry.
        And I also think about the Biden-Harris administration.
    They chose to remain in D.C. and have proposed $7 trillion in
    tax hikes, where the Ways and Means Committee has been
    traveling across the country to hear firsthand about the
    challenges of working Americans who are currently facing to
    develop a roadmap to get our economy back to where it was
    immediately following TCJA in 2017.
        For example, we have set up tax teams, through Chairman
    Smith, 10 different tax teams that are meeting and getting
    feedback from across the country. I happen to chair the
    American Workforce Tax Team, which is considering ways to
    better utilize the Tax Code by hiring and retainment of more
    workers, and all of us are a part of those tax teams.
        I have a number of questions, but I will start with you,
    Mr. Sukup. You mentioned in your testimony that following TCJA
    you were able to significantly expand your business operation
    and hire more workers. Can you provide more details on how
    provisions from TCJA allowed you to hire and retain more
    workers?
        Mr. SUKUP. Well, the accelerated depreciation on research
    and development was just critical on that, that we could take
    that return on investment. We invested in wages and staff and
    engineering, provided better products. And our customers liked
    our products, and we added 200 manufacturing jobs. And with
    accelerated depreciation, we add capital equipment, we need
    skilled folks to run that, and so we added 200 individuals over
    this time period.
        Mr. LaHOOD. Excellent.
        I mentioned that I have a heavy ag district. And the
    potential economic growth around the biofuels industry is
    something, again, I have been very engaged in and spent a lot
    of time talking about. As we look to future tax policy
    proposals, can you comment on the specific pro-growth
    initiatives that can better support our farmers and biofuel
    producers?
        Mr. SUKUP. Well, it is one that, you know, I think
    Congressman Feenstra said about practically one out of every
    two rows of corn is going to biofuels. It provides us with
    energy self-sufficiency here in the U.S., which I think is just
    absolutely critical. And it can provide, going into like the
    45Z, to give us more incentives to be--take less carbon out of
    our air.
        Mr. LaHOOD. Thank you.
        I yield back.
        Chairman SMITH. Mr. Estes.
        Mr. ESTES. Well, thank you, Mr. Chairman.
        And thank you for our witnesses for being here. It is so
    heartening to hear your stories, just because it tells about
    the success that has happened since TCJA was passed. And
    whether you are talking about research and development or
    depreciation or being able to go through estate planning or
    planning your lives or, you know, how you can actually help
    wages increase, as we have talked so much during this panel of
    all the benefits that came out of TCJA, it is so great to be
    here. We are out of the D.C. bubble, being able to talk to
    people. I call it the real world out here, away from the D.C.
    Beltway.
        You know, being here at the Iowa State Fair, it is, I know,
    a lot like the Kansas State Fair where people come for the
    rides and the food and entertainment. But I know also that
    people come because they want to learn more about what is going
    on in the agriculture arena, what kind of innovation and ideas
    that are out there.
        Of course, not to be competitive, but the Iowa State Fair
    did start 20 years before the Kansas State Fair did, and also I
    think maybe have better marketing folks. But the one excuse I
    will use is that the Iowa State Fair was started before Kansas
    was a state, so we couldn't really call ours a state fair at
    that point in time.
        And, you know, while we are here, as we talk about all
    these innovations that Americans are known for and we learn
    more about what is going on in terms of how American
    agriculture feeds and fuels and provides clothing for people
    around the world, I know it is tough in the rural agriculture
    communities. I grew up on a family farm. In fact, my mom still
    lives on the farm that we have back in Kansas. And farmers have
    benefited for more than a century with technological advances
    trying to help provide that food and the benefits for the
    world.
        Tax Cuts and Jobs Act recognizes how valuable that
    innovation was, and I know Americans have invented everything
    from air-conditioners to zippers, so innovation is strong and
    part of our way of life here. And we want to make sure we
    continue to encourage that.
        I am chairing the Innovation Tax Team as we go in and look
    at preparations for next year, and we want to make sure that we
    continue to have a tax code that actually provides and
    encourages our ability to create an event and come up with new
    ideas that actually make the world a better place.
        Mrs. Dewalt, there is no question that countries like
    China, which actually provides 10 times the tax credit of
    research and development now than the United States does, and
    they are starting to gain--actually, they have closed the gap
    on the United States in terms of the amount of research and
    development done there. Can you share your thoughts on what the
    United States needs to do to be a global leader in innovation?
        Mrs. DEWALT. Well, I think TCJA went a long way with the
    provisions that you mentioned, the expensing, R&D focused,
    bonus depreciation, lower tax rate, competitive--globally
    competitive tax rate. In The Home Depot's view, it certainly
    has been the most impactful to us to encourage--to allow us to
    invest; not only to encourage but to allow us to invest further
    in the U.S. We are primarily U.S. We have 2,000 locations here
    in the U.S. that, you know, serve all communities, large and
    small. And so the ability to have a competitive rate in the
    United States, encouraging companies like ours to continue and
    to increase investments as we have, and to encourage companies,
    you know, other companies to invest and innovate in the U.S.
        So I would say that there are some incredibly powerful
    provisions in TCJA that encourage investment of all kinds in
    the U.S., innovation and otherwise.
        Mr. ESTES. Thank you for that.
        And as you noted, you know, the 21 percent is only a
    portion of the taxes you pay. That is the federal portion. And
    that, as you said in your remarks, that you pay 24 to 25
    percent, which actually puts us slightly above the developed
    world in terms of the tax rate still, but it makes us
    competitive in terms of being able to do that.
        So we want to make sure that we continue to have the value
    out of that tax code that encourages businesses to be
    successful here.
        Even with the lower tax code--the tax rate at the federal
    level, we have seen corporate tax rates increase and tax
    revenue increase. We have seen the royalty tax increase by over
    $200 billion over the last 7 years, because more research and
    development, more intellectual property was based in the United
    States and that we were able to actually benefit from that as
    far as federal tax receipts as well.
        So I know I am out of time here, but I just want to thank
    all of you for being here, being able to talk about the
    positive aspects of the Tax Cuts and Jobs Act on each of you.
        Thank you, Mr. Chairman. I yield back.
        Chairman SMITH. Thank you.
        Ms. Tenney is recognized.
        Ms. TENNEY. Well, thank you, Mr. Chairman.
        And thank you to all the witnesses and everyone for being
    here. This is quite an incredible experience to be at the Iowa
    State Fair.
        And I am from Upstate New York, and we have--my district,
    the newly conceived 24th District, is actually the largest
    agricultural district in the Northeast, including the largest
    dairy district. So it is very different than New York City
    where my colleague, Nicole Malliotakis, lives.
        But Zach Nunn said, so you are basically the Iowa of New
    York. So, yeah, in a way we are. We have an incredible output
    with ag, and it is really important in our district. But I am
    also a small business owner, so I know what it is like to
    struggle to make payroll, to deal with taxes and all those
    things.
        And I also want to just--I mean, I think it is just
    incredible that you are all here with such a different
    perspective. Every one of you has a small business perspective,
    a large business perspective, the child care perspective. But
    you are all talking about the one thing that changed upstate
    New York in that we come from the highest taxed state is the
    Tax Cuts and Jobs Act. It was incredible. I voted for it. And
    it was always this stunning, oh, my gosh, I can't believe you
    are voting for that from New York.
        Most of the businesses, as Ms. Pol said, in our communities
    are driven by small business owners, including our farmers. And
    so we are just grateful to all of you for putting it in your
    words exactly what the catastrophic results could be if we
    don't continue with these issues.
        But I wanted to just first start with Ms. Pol. And you are
    an NFIB member, as we are. My business is over 40 years as
    NFIB. They put out great data and great statistics and advocate
    well for our small business community because we don't have
    some of the larger issues. But you talked about 199A, if it
    should expire.
        Could you tell me just briefly what the operational changes
    you would have to make in the business if that were to happen?
        Ms. POL. Well, currently I think what we would do is stop
    investing. You know, we wouldn't be able to expense out the
    equipment. You know, we wouldn't have the extra money to
    reinvest into our employees and anything else that we wanted to
    pursue.
        Ms. TENNEY. Well, when you stop investing, you are
    coasting, and that means you are going downhill. That means you
    are not preparing for the future.
        Thank you.
        And I just want to move a little bit to something a couple
    of you touched on, especially, Mr. Sukup, you talked about
    this, as well as Mrs. Dewalt. I raised my son as a single
    parent, but I also took care of my parents who were across the
    street with serious health conditions, and so I am part of that
    sandwich generation. And it was always a struggle to find
    daycare and for parents--both men and women. It depends on who
    stays home, but now it is a mixed opportunity.
        You know, we talked about like the--some of the things that
    we worked on. I worked on a bill called the PACE Act, and that
    is Promoting Affordable Childcare for Everyone, and giving
    employers the opportunity to invest.
        And if you could just touch briefly on if it would help you
    to get an additional tax credit or benefit to help with child
    care facilities right on your properties. And maybe you could
    touch on that as well, Mrs. Dewalt.
        Mr. SUKUP. Well, right now we are in the process, we are
    hoping to open October 1, to put a 112-space child care
    facility right across the street from our company. Right now it
    looks like about 40 of our employees will take advantage of
    that. And it is just critical to working families. You know,
    some of the families both are working, whether for us or down
    the road at Mason City or another community business. And, you
    know, if there are families that have two of them in child
    care, it is just, you know, astronomical.
        And then, again, that sort of ties into the estate tax. I
    don't see that I would have really said, yes, let's go do it.
    But the third generation, daughter Emily, comes to Sheffield
    every day, and she goes, this is important to families. Let's
    do it.
        Ms. TENNEY. Yeah, I would have loved to have that child
    care option at my office. I had to take that risk of leaving my
    son somewhere and not knowing what he was going to be--he
    always survived somehow when I got back. But I know the fear of
    families. They want to stick together, especially these days.
        But I know, Mrs. Dewalt, you mentioned something on this
    same as the child care, but would an increase in a little bit
    more of a benefit for child care deductibility and also maybe
    dependent care deductibility for people like me and others who
    have a dependent child or family member, maybe a parent that
    they have to take care of, is that something that if we
    increase that benefit, would that be beneficial to your
    employees?
        Mrs. DEWALT. Thank you for the question.
        And certainly it most likely would benefit our associates.
    You know, benefits that support working families are very
    important to us. I mentioned, you know, the 400,000 associates
    we have. Most of those are front line in our stores, in our
    distribution centers. So certainly policies that support
    working families would benefit our associate population.
        Ms. TENNEY. Thank you.
        Well, I appreciate that. It is really incredible that you
    are all talk--these are really important issues. I just want to
    say one shout-out to one of the counties. I just went to the
    Wyoming County Fair in upstate New York. The county
    legislature--or the county supervisors do a wonderful thing.
    They actually hold a meeting, their August meeting at their
    county fair. And it is filled with all kinds of people out
    there to see their government in action. So shout-out to Becky
    Ryan, the supervisor.
        And thank you, Chairman Smith, for doing this out in Iowa.
    We appreciate it.
        Thanks. I yield back.
        Chairman SMITH. Thank you.
        Ms. Malliotakis, the other lady from New York.
        Ms. MALLIOTAKIS. Thank you, Mr. Chairman.
        We have traveled to many parts of the country hearing from
    people like you, and, you know, whether you are in Iowa,
    whether you are in my home State of New York, I mean, the
    reality is that the high inflation, the high interest rates,
    the anti-energy policies of the Biden-Harris administration are
    crushing American families and American businesses.
        Sixty-six percent of Americans say they are living paycheck
    to paycheck. And if they think it is hard now, that is nothing
    compared to what it will be like if Democrats have their way
    and allow the provisions that we are discussing today from the
    Tax Cuts and Jobs Act enacted by President Trump, if they allow
    that to expire in 2025.
        Under TCJA, on average, Americans with less than 100k in
    income got an average of 16 percent in a tax cut. We saw the
    creation of millions of jobs, record low employment for African
    Americans, for Hispanics, for women, for veterans. We saw the
    middle-class wages across this country lifted, and we saw the
    doubling of the standard deduction, which was a major credit
    for working families, and also the doubling of the Child Tax
    Credit for working families, lifting six million Americans out
    of poverty. And important to New Yorkers, it got rid of the
    alternative minimum tax for millions of middle-class families.
        Last June, I introduced legislation to increase the
    standard deduction by an additional $2,000 for single filers
    and $4,000 for married couples. If it were law today, families
    would benefit with a $33,200 tax deduction in 2024.
        And while I want to increase it, sadly, Kamala Harris, the
    Democrats, they have said that they want to get rid of--they
    actually want to cut our deduction in half. They want to go
    back to what it was before we had this critical tax relief.
        So I will start with Sarah. As a family, what would the
    standard deduction being increased even further mean for a
    family like yours?
        Mrs. CURRY. Well, I think first and foremost--thank you for
    the question--reducing the standard deduction would negatively
    impact my family because it would raise my taxable income both
    at the federal and the state level. We experienced benefits
    from tax simplicity. I didn't have to have receipts, you know,
    all over the floor trying to itemize all this stuff trying to
    save a buck. We were able to take the standard.
        But, again, Iowa and many states use the federal taxable
    income as the starting point for state taxes owed. And so with
    a reduction in the federal standard deduction, my state taxes
    will also go up. So I am not going to get hit once with this
    tax increase, I am going to get hit multiple times over.
        Ms. MALLIOTAKIS. That is right. And that is exactly why I
    wanted to see the standard deduction not only kept but enhanced
    to protect more middle-class families, because that is who
    really benefits from it.
        And with that said, the alternative minimum tax, do you
    have an opinion if that were to be added back?
        Mrs. CURRY. Again, you know, any tax that is brought back
    that is hurting American families and taking more of our earned
    money away from us so that we can't spend it on our families
    and invest in our homes and our children is a bad thing.
        Ms. MALLIOTAKIS. Well, that is exactly what, sadly, Kamala
    Harris and the Democrats have said they intend to do. $7
    trillion is what my colleague said in tax increases is what
    they are proposing.
        But I also--you know, I don't have a farm in my district,
    but my constituents do eat, and they use energy. And so the
    Biden-Harris tax and energy policies have been crushing
    domestic energy production. It is driving up the cost of
    everything, I believe, right.
        So can you talk as farmers about how energy drives up the
    cost of food for the people I represent in New York and also
    maybe want to touch on some of the renewable energy sources
    that we can derive from both corn--and I did visit a facility
    where there was renewable natural gas from food waste, from cow
    manure, and I thought that was really interesting. It is
    cleaner. It is more efficient. It is more affordable than
    these, you know, EVs that they are trying to push us on through
    all these incentives that go to Communist China.
        Would you like to comment on that?
        Ms. RIESSEN. Absolutely. So just to--let's talk about EVs
    for a moment. I know they are trying to do that to tractors.
    And let me tell you, that is definitely not going to work. It
    is going to increase the weight of that tractor by three to
    four times. It is going to increase the price of that tractor
    by that exact same amount. And then, oh, by the way, in the
    wintertime, 60 below, they don't start.
        And getting back to your being able to use other--besides
    the biofuels, to use the methane, and just so you know, there
    is more landfill methane given off than any other source in the
    United States, so there is a place to tap.
        But when it comes to using the other fuels, first of all,
    right now the ethanol is available, and we can put it right
    into the gas tank. We are pushing for the Next Gen Fuels Act to
    be passed to increase those amounts of ethanol to be put in
    fuel tanks. So--and for every percent of--this is from the
    American Lung Association. So for every percent of ethanol that
    we are able to put into that fuel tank, we are also reducing
    our healthcare costs because we are taking particulates out of
    the air.
        So especially as I--and I have been to New York, and it is
    amazing, but it is not Iowa. But, anyway, just the total amount
    of particulates in the air just due to the pollution,.
        Ms. MALLIOTAKIS. Okay. And, Mr. Sukup, I don't know if you
    wanted to add to that.
        But I did have one small question after this, if you will,
    Mr. Chairman.
        Mr. SUKUP. No, the biofuels are critical for the--supplying
    us across the U.S., energy efficiency and self-sustainable here
    in the U.S., and that is why we have to increase. It lowers
    prices throughout. You know, going back 4 years, we were a
    dollar lower on gasoline, and yet ethanol was practical and
    making money.
        Ms. MALLIOTAKIS. Now, I am a New Yorker, first time in
    Iowa, first time at the State Fair, so a last question, very
    important question, in my opinion, to wrap up the hearing here.
    What is the food that I should try today?
        Go down the line. Name one food, please.
        Ms. RIESSEN. Pork chop on a stick.
        Mrs. DEWALT. Well, I am smelling bacon right now, so
    whatever that smell is, try that. That smells great.
        Ms. MALLIOTAKIS. All right.
        Mrs. Curry.
        Mrs. CURRY. The deep-fried pickle with the ranch dressing.
        Ms. MALLIOTAKIS. All right.
        Ms. RIESSEN. Sorry. Pork chop or a steak.
        Ms. MALLIOTAKIS. Okay. You are the second person to tell me
    that.
        Mr. SUKUP. Corn dog.
        Ms. POL. The deep fat fried lobster on a stick.
        Ms. MALLIOTAKIS. All right. Thank you.
        Chairman SMITH. I want to thank the Iowa delegation for
    having us. I want to thank you, Congressman Feenstra, for being
    a stellar member of the Ways and Means Committee and for
    bringing us up here. I want to thank the Iowa State
    Fairgrounds. And I want to thank each and every one of you all
    for your great ideas and the policy solutions that hopefully we
    can move towards. I think that every member of this committee
    will be leaving the Iowa State Fair with additional great ideas
    on the Tax Code but also probably higher cholesterol.
        But with that, please be advised that members have 2 weeks
    to submit written questions to be answered later in writing.
    Those questions and your answers will be made part of the
    formal hearing record.
        And with that, the committee stands adjourned.
        [Whereupon, at 11:56 a.m., Central, the committee was
    adjourned.]

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