Hearing with Treasury Secretary Scott Bessent

The committee will come to order. Welcome back, Secretary Besson, to the best committee in all of Congress, the Ways and Means Committee. Um Since since you last came before this committee, the average American has more money in their pocket from the working family's tax. This filing season, refunds were up more than eleven percent, and tax refunds totaled nearly three hundred and twenty-five mi- billion dollars. A family of four with two kids making seventy-three thousand dollars or less owed zero in federal income taxes. Sixty m- sixty-two million Americans claimed at least one of President Trump's new tax relief priorities, such as no tax on tips, no tax on overtime, no tax on social security, and no tax on auto loan interest. Your department just revealed that the majority of Americans who benefited from these policies earn under a hundred thousand dollars. Nearly six million kids now have Trump accounts to save for their future. Nearly forty million families claimed the child tax credit that was increased to twenty-two hundred dollars and permanently, permanently indexed for inflation so that the credit, the credit never loses value. Americans across the country are experiencing what tax relief means for them. At a hearing, a waiter from Arizona told us how he is using his tax savings from No Tax on Tips to start law school. A Texas steel worker said he can now afford to start a family from no tax on overtime. A couple in Texas adopted a second child with the help of the adoption tax credit, and in every community working class Americans have their own version of the story because President Trump, because President Trump and Republicans in Congress delivered real tax relief. However, every single Democrat voted against this tax relief, hiding behind the false claim that these tax cuts only help billionaires. But we all know the truth. There aren't any billionaires who work for tips. I don't know any billionaires that work for overtime. There aren't any billionaires who rely on social security. There aren't any billionaires that need an auto loan to afford a car. Republicans targeted tax relief to the Americans whose paychecks were stretched thin by Democrat inflation that needed help. The working families' tax cuts provided bigger refunds and bigger paychecks, and permanent, permanent pro-growth tax policy. And it will make it easier to build, to invest, produce, and hire in America. Our economy is in the middle of a historic, historic construction boom that means new jobs, and opportunities for working class Americans. Factory activity grew every month this year and reached its highest level since May of twenty twenty-two. Equipment investment rose seventeen percent, and investment in intellectual property rose eleven percent in the first quarter of this year. In the same period, Economic growth was driven by two things, investment and exports. Republican policies are making investing in America a solid bet for companies after decades decades of America's manufacture manufacturing power declining. The President's tax and trade policies work hand in glove to fuel the economic investment that creates great paying jobs, reciprocal trade agreements have secured ten trillion in investment commitments in leading industries, opened new markets, formally hostile to US exports, and made our trading relationships fairer for American workers, farmers, manufacturers, and producers. American producers exported Just last year, a record three point four trillion, trillion dollars. And, and in the first three months of this year, first three months of this year, U- US exports were over three hundred billion each month. That's the highest in two hundred and fifty years of our country's history. America is becoming less dependent on China. a goal long promised by Washington politicians with no actual progress until President Trump. Our trade deficit with China fell thirty-two percent last year to the lowest level since two thousand and four. The Chinese recently agreed to purchase at least seventeen billion dollars annually in U. S. agriculture products through twenty twenty eight alongside more Boeing airplanes. President Trump and Republicans in Congress repealed the de minimis privilege that mostly benefited Chinese companies, shipping products, undercutting American producers and manufacturers. Our economic security is a cornerstone of our national security and therefore must not be abused. by bad actors. Yet this committee's investigation into US-based non-for-profits revealed many are funded or operate under the influence of foreign countries like China. And they sow division and chaos in our communities that weakens America and strengthens foreign adversaries. Tax exempt status is a privilege. not a right. We have called on the IRS to investigate and if necessary revoke the tax exempt status of eleven different organizations who are the focus of our investigation. It is critical that the IRS take close look at tax exempt organizations with documented histories of activity that de-stabilizes society and supports terrorism. Looking ahead, our tax policies must continue to make our economy the most competitive for innovative sectors of the future, including digital assets and the over sixty million Americans who own cryptocurrency. America needs clear modern tax rules to ensure we remain the crypto-capital of the world. Next week, we will be holding a legislative hearing excuse me, on policies that offer solutions to pressing issues surrounding digital asset taxation. Mister Secretary, excuse me,

Water.

um, I know you are a strong advocate for ensuring Main Street's shares in the prosperity of our economy. And I look forward to hearing how Treasury is implementing the working families' tax cuts, so that Americans who power our economy, workers, small businesses, farmers, manufacturers and producers and innovators have a brighter future. I now recognize the gentleman from Massachusetts, the ranking member.

Thank you, Mr. Chairman. Uh, Mr. Secretary, welcome, as always. Uh, the Chairman made the point that this is the best committee in Congress. That's likely to be one of the few things we agree upon this morning. As all know. And you hold, as I pointed out in the past, one of the most important jobs in the world,

Mm-hmm.

as a successor to Alexander Hamilton. We hope that there'll be some explanations this morning about the failures of many of the economic promises that were made by the Trump administration. Seventy percent of the American people disagree with the economic direction that the country has taken. Last time you visited with us, Americans were being socked with price hikes because of the tariffs where you and I met in front of the Supreme Court that day when the Supreme Court took and heard the oral arguments because of the big, ugly bill. We fought on our side every step of the way, knowing and predicting what was to come. Higher costs, millions kicked off of health care, children going hungry, all in service. to the wealthiest amongst us. Despite this, a rosy picture was painted about the Trump economy and what it might deliver. It's safe to say that almost on every front those predictions from the administration have been wrong. Workers and families are being forced to stretch their dollars further every day, and the pain so clearly stems from many of these projects, including what was supposed to be a cessation of endless wars. We've watched the price hikes that that are coming because of this tariff regime. And during testimony last year, you suggested that the Trump policies would lift the working and middle class and reinvigorate American manufacturing. It was stated that take-home pay and wages would increase. You relied upon consumer confidence data to tout the strength of the economy. You pointed out that inflation was improving and that costs, including food, energy, and shelter, would be coming down. And now we have a chance to reflect upon what actually happened, including the slow walking of the tariff refunds that are due. Families are forced to shell out seventeen hundred dollars more last year to cover many of the costs that were estimated to be rosy here not that long ago. Between the tariffs, the Iran war, prices are rising faster than they have in years. Last month the inflation rate up, ate up paychecks. I appreciated the chairman's position on pointing out that there has been a routine of three percent increases, but when you're paying more for everything else, that quickly goes away. The price of a tank of gasoline in many places has gone up by almost fifty percent. That's a staggering amount. And despite the bullish assessment in January that economic growth would hit five point four percent in the fourth quarter, that growth came in at approximately one half a percent, not even a full percentage point. That's not spin. Those are facts. The administration conting- continues to argue that down is up and to convince people that their pain should be subjugated to patriotic causes. While they're celebrating higher credit card delinquencies on households, they're spending more every day because of the economic policies of the administration. As if the seventeen hundred dollars to cover the tariffs wasn't enough, estimates are now showing that the war in Iran has already cost households another seven hundred and fifty dollars. And while an extra two hundred dollars in gas costs might be, might not be a lot for some folks in the administration, it sure is for a lot of working families. I'm sure we're gonna hear that there are many attempts to save the economy by touting the refunds. Those refunds were eaten up almost overnight because of increases in gasoline prices. Tax refunds fell short of the promises by sixty-five percent and have been completely wiped out, as I noted, by price hikes. The president's attention remains everywhere, but what's most important, as he said, he's not thinking about people's financial situations. He tends to be focused on more vanity projects, including a ballroom and an arch, and painting the reflecting pool. We are now ready for a cage fight on the South Lawn and perhaps a two hundred and fifty dollar bill with his photograph on it. We look at what has happened recently with the slush fund that was created, and our Republican colleagues continue to go wobbly on their defense, perhaps not understanding how this is playing with the American people. I know the administration has been busy trying this week to explain all of it, telling members of Congress that the slush fund is dead, apparently not consistent with what the president offered but twenty-four hours ago. Let's be real. The two hundred and fifty dollar bill maybe might be needed because of the price hikes that are coming to the American people. Americans have made this very clear. Seventy-seven percent say the policies have increased the cost of living, and more than half say it's worse than they can previously remember. Consumer sentiment is currently at a record low. The savings rate for American has dropped to two point six percent. cut in half in just a year. When we look at this economy, we see failure upon failure. The policies that have been proposed have really not worked for average Americans. Families are getting crushed, and we would suggest today that a new course of action needs to be taken. Republicans have made it clear that they don't want to put a stop to the chaos. But Democrats are unwavering in our fight for American families to lower cost and to end the harm that is being done. Thank you, Mr. Chairman.

Thank you, Ranking Member, today's sole witness is United States Secretary of the Treasury, um, Scott Besson. The committee has received your written testimony and it will be part of the formal hearing record. Secretary Besson, you have five minutes to deliver your remarks and you may begin when you're ready.

Good. Chairman Smith, Ranking Member Neal, and members of the committee, thank you for convening today's hearing. I'm grateful for this opportunity to discuss President Trump's twenty twenty-seven budget, which builds on this administration's progress in unleashing a new era of economic expansion. I last appeared before this committee just a few weeks before the House passed the working family's tax cuts. So on the heels of the most successful filing season in IRS history, I'd be remiss if I did not begin by thanking the committee for helping to deliver this once-in-a-generation bill to the President's desk. This tax day, under President Trump, we celebrated how much more money hardworking Americans kept, not how much the government took. Over sixty-two million tax returns claimed at least one of President Trump's signature new tax cuts. No tax on tips, no tax on overtime, deductibility of American car interest loans, and an enhanced deduction for low- and middle-income seniors. All told, the average refund increased by over eleven percent, with total refunds increasing by eighteen percent. But as important as what the legislation achieves, it is what it prevented. If opponents of the working families' tax cuts had had their way, our economy would have absorbed the largest, the largest, tax hike in its history, over five trillion dollars. Ninety percent of American taxpayers would have seen their standard deduction slashed while forty million families would have seen their child tax credit halved. Instead, this committee held the line and the American people had a better tax day because of it. Notably, President Trump's pro-growth policies don't stop at putting more money back in the pockets of working and middle class families. They extend to placing the American dream within closer reach of their children. For context, nearly forty percent of Americans have no exposure to US equities, no stakes in the companies they help to build. Trump accounts represent a profound reimagining of that arrangement. They will ensure that every American child can benefit from private ownership and compound growth. that every American child, in short, is born a shareholder. To date, nearly six million Trump accounts have been opened, with one point four million eligible for the one thousand dollar seed contribution from Treasury. Of course, as these tax cuts deliver resi- relief for working class Americans, President Trump's economic agenda is bolstered by two other distinct but reinforcing levers, trade and deregulation. Let me briefly address both of these in turn. First, the President is undeterred in his determination to open markets for U. S. goods and services while rebuilding U. S. manufacturing capacity. Over the twelve months ending March, twenty twenty-six, the trade deficit for goods declined by three hundred and seventy billion dollars, compared to the same time frame ending March, twenty twenty-five. The economy has added three hundred and thirteen thousand net new private sector jobs. and thirteen thousand manufacturing jobs in the past two months. Firm capital expenditures rose at an annual rate of over seventeen percent in the final quarter and companies are investing trillions to build and expand here at home. American industry is winning again to the benefit of American workers. A whole of government approach meanwhile is coupling our manufacturing revival with a great regulatory reset. Properly calibrated regulation is essential for economic growth. capital formation, employment and higher wages. So at the outset of this administration, President Trump set the ambitious benchmark of slashing ten existing regulations before issuing a new one. In twenty twenty five, we shattered that goal with a ratio of a hundred and twenty nine to one, and as a result, the regulatory actions generated more savings last year than in those of the prior Trump administration combined. Separately, any one of these initiatives on trade, tax cuts and deregulation would be substantial. Taken together, they are transformative. Before President Trump took office, our trading partners exploited America's markets, our regulatory state's smothered businesses, and our tax code was poised to punish workers and job creators. Today, his policies are driving lower taxes, bigger paychecks, and broader prosperity. So I thank this committee for its partnership in this critical work, and I look forward to building upon our strides through the President's budget for the year ahead. Thank you.

Thank you. We'll now proceed to the question and answer session. Mister Secretary, yesterday in the Senate you received a lot of questions from the Democrats over the anti-weaponization fund, which it's Acting Attorney General Todd Blanch said on the record is dead. You also told the Senate Finance Committee over and over and over and over a few more times again that you cannot discuss the settlement or the case due to ongoing litigation. Can you please set the record straight right at the top of this hearing, so members so members do not need to use their limited time asking you questions you cannot answer. What is the status of the fund, the settlement agreement, and what part did IRS CEO, Mister Bisignano, play in both?

Good. Uh, thank you for this question, Mr. Chairman. I said yesterday that Einstein's definition of insanity is asking the same question over and over again and expecting a different answer. Let me be clear, as we have done throughout this matter, the Department of Treasury is following the direction of the Department of Justice. Acting Attorney General Todd Blanch testified on Tuesday that the government will not be moving forward with the fund. We intend to comply with that direction and Attorney General Blanch's the direction. I do not have any details into what that means at this time, but I will note that even the Acting Attorney General Blanchard's statement Tuesday this matter is still subject to ongoing litigation, so I'm unable to comment further on it. That means I'm also not able to discuss any part of the settlement agreement. As with all department litigation, the Department of the Treasury and the IRS are represented by the Justice Department, so any additional questions about the settlement Or the funds should be directed to Acting Attorney General Todd Blige. To your point about Mister Benziano, while I cannot speak on his behalf, I will note that the settlement agreement calls for United States to issue an apology to the plaintiffs for among other things leaking their tax returns. Mister Chairman, President Trump is a great American who has endured over ten years of harassment and weaponization from all level of government. No American should be targeted for political reasons.

Thank you, Secretary, for starting out with that information. This tax filing season was the most historic because of the tax relief delivered to working-class families through the working families' tax cuts. How much total tax relief did Americans get just this tax season?

Approximately three hundred and twenty-five billion, Mister Chairman.

And how much did the average individual tax refund increase?

the average refund increased by more than eleven percent, but that does not if that does not reflect the dollar value. As the ranking number said, likes to say, we over-promised and under-delivered, that is incorrect, because so many people owed taxes last year that the dollar increase was actually much larger going from negative to positive. As I travel the country, I have so many taxpayers who thanked me because they had to pay last year, and they got a refund this year.

So how many taxpayers claimed at least one of President Trump's priorities of no tax on tips no tax on overtime no tax on social security or the auto loan interest?

Approximately sixty-two million filers, or about forty-four percent, Mister Chairman.

And so what percent of tax filers who received a tax cut in filing season earned less than a hundred thousand dollars?

Just over seventy percent, sir.

Seventy percent.

Seven zero.

So what percent of waiters and other tip workers who received a tax cut, thanks to the no tax on tips, earned less than a hundred thousand dollars?

Ninety percent.

Ninety.

Nine zero.

That's r- that's helping people that need it the most. Funny, Democrats always claim, always claim that the working family's tax cuts were for billionaires. Mister Secretary, I I'm sure you know a lot of billionaires. Do you know any billionaires that was able to use the no tax on tips deduction?

I have plenty of billionaires I give tips to, but not monetary tips, sir.

Do you know of any billionaires that was able to use the no tax on overtime deduction?

Uh, no, sir.

Absolutely not. But you'll hear all day today. that this tax cut was for the billionaires. But the evidence proves differently, and I so I I greatly appreciate that. I'm sure we will hear about inflation in the economy today, too. And so at this point, at this point, during President Biden's term, what was the core inflation rate?

Six point two percent, which led us to the worst inflation in forty nine years, sir.

Absolutely. N was the highest under Biden. What was the highest?

Six point six.

Six point six.

Se- September of twenty two.

And so what is core inflation this very second?

Two point eight percent.

Two point eight percent. But at this time, during the Biden administration, it was six point two?

Yes, sir.

Wow. You wouldn't,

Wow.

you wouldn't think that was the case based on the the rhetoric coming from the other side, but That's, that's what we're gonna get. The working families tax cuts renewed and revamped the Opportunity Zone programs to ensure that rural communities get their share of the benefits. The law provides incentives that will drive an estimated a hundred billion in new investments into rural communities, helping small businesses and working families and underserved often overlooked areas of the country. How is the Trump administration implementing this improved opportunity zone program to ensure, ensure rural communities that I represent are in fact benefiting in the way Congress intended? And how is Treasury utilizing the new transparency requirements within the program to reinforce this effort to target those underserved communities?

Uh Mister Chairman, as someone who grew up in a rural community, I'm very excited by the prospect of these opportunity zones, uh, the being available there. I - I think it is new and important seeing the success, and I'm also excited by the permanence. And I would also point out, uh, that many members from the other side of the aisle have called Treasury, they are concerned about losing opportunity zones in their districts or states in the case of senators. And I pointed out to them that they voted against them, but we will work with them on these opportunity zones. Uh, Congress wanted to reach the uh all all levels and we are working on transparency requirements, the uh which are critical because to make sure that the investment is reaching the rural communities small businesses and local projects.

Thank you. On January fifth, twenty twenty six, through the hard work of both you and your staff, the Treasury Department secured a side-by-side agreement that largely exempts U. S. headquartered multinational enterprises from the OECD's income inclusion rule and undertaxed payments rule. This is a major, major win for U. S. tax sovereignty. How confident are you that this agreement will be respected and fully, fully implemented by OECD members particularly in the European Union.

Uh, I - I believe that we have the tools necessary that if our sovereignty is not respected, uh, to uh counteract any failures to enact this, and I believe this is important because with this, the money comes into the US treasury rather than foreign treasuries, Mister Chairman.

What I would say, Secretary, you can count on us as working hand in glove as allies because Congress can also move legislation to make sure that they honor this, and we're willing to do that if they do not honor your commitment.

And s- Mister Chairman, I will point out that my friend Senator Wyden complimented this side-by-side via when he was back in Oregon recently.

It's great to hear. What monit- what monitoring has Treasury put in place to ensure that U. S. companies are not still subjected the discriminatory treatment.

Uh, we we frequently meet with the companies and we have active engagement with the OECD on this matter.

Thank you. I now recognize the ranking member.

Thank you, Mister Chairman, a reminder that members of the committee, they get to decide how to allocate their five minutes w- as long as they're within the framework of the questions that they wish to ask. So, Mister Secretary, were you or any employee of Treasury informed of the settlement that the Attorney General entered into

Uh.

with the plan of the fund?

Uh, uh, again, Congressman, there's ongoing litigation and, as I said, I'm unable to answer.

Fine. So, I think we can agree upon this. There were four hundred thousand taxpayers that had their tax information leaked when Charles Littlejohn released that information. We all agree, no citizen should have their taxpayer information leaked. That's a clear violation. But if we follow the logic of what has been proposed, then the suggestion would be that these four hundred thousand people would be never subject to any sort of IRS oversight?

Uh, I, again, I'm unable to comment on that.

OK. OK. So, let me go back to part of the statistical data that's been gather gathered. With Barnstable, Massachusetts, which is a central hub on Cape Cod for commercial and transportation activity, they rely upon tourist dollars. It's a big deal. Over the last year, there's been a fifty-four percent decrease in Canadian tourists. We're slow-walking the tariff refunds. You and I were there, as I reminded the the audience today, when the Supreme Court heard those arguments, and the suggestion was that the tax refunds were gonna proceed expeditiously. That is not happening. There have been arguments that somehow that they've been slow-walked on purpose because they did cost a hundred and sixty-six billion dollars which would come from revenue that previously had been allocated. In Las Vegas, those who fly into the Harry Reid Airport, four point nine million people flew in last year. That's down by twelve percent. The positions that we have taken on the tariffs, the positions that we have taken on trade, have really been inconsistent with previous presidents and previous administrations. We understand how tariffs might be used to penalize an adversary, but the application of these tariffs are not working for the American family because of the price increases that are being experienced, particularly in the agricultural states where we can see where much of the political turmoil is now playing out. Ground beef is up by twenty percent. As I noted earlier, gasoline, fifty-one percent. Airfares have spiked by twenty percent. And everywhere that we turn, there's a price hike because of the economic policies that the president has embraced. Inflation has hit three point eight percent. We've watched out now perhaps we're gonna change the independence of the Federal Reserve Board for the purpose of complying with some political suggestions. Let me suggest here that we think that the independence of the Federal Reserve Board, and in fact the independence of the former sec- the former chairman of that board, helped to guide us through a very rocky period of time. We watched how that service was denigrated, time and again, despite the fact that it was an honest patriotic effort that was made by that treasury, I'm sorry, that uh chairman to get us through again a very, very difficult period of time. But if we don't like the outcome with the consumer price index, we get rid of the forecaster. If we don't like the result of what the Federal Reserve Board has said, then we threaten and intimidate the Chairman of the Federal Reserve Board. The argument has been, since your last visit, that lowering costs was something that we all embraced. But there's a fundamental acknowledgement and it is not happening. I cited uh a previous statistic that I think remains very compelling this morning. Seventy-seven percent of the American people disagree right now with the economic positions that are being embraced by the administration. With that, I yield back my time.

Thank you, Mister Buchanan.

Thank you for being here today, Mister Secretary. Passing the working family tax cuts w- was a major win for all Americans. In addition to the record tax refunds that millions of Americans have have received, I'm expe- especially excited about the the law as it pertains to small business. A hundred percent bonus depreciation for business investment will boost the economic growth in manufacturing, by encouraging small business to invest in America.

So forth.

Someone that's been in business for a lot of years, I can tell you the reality is very much the case. In addition, the permanent one ninety nine A small business deduction will make it easier for small businesses to create jobs and reinvest in their cor corporations, or operations. More than anything else, I'm excited about the fact that we made a lot of this permanent, it'll make a huge difference uh going forward, and it has already. Working families tax cuts are ensuring that American businesses can thrive and grow uh in the economy. I had a good fortune of being chairman of the F- Florida Chamber. We had a hundred and thirty thousand businesses, and these tax things I can tell you make a big difference. And the guy who's uh Mark who's CEO s- m- made that reference to me many times. Mister Secretary, The small businesses in my district tell me a hundred percent bonus depreciation is so important that that decision i- is key to their buying equipment and other things. What's your thoughts on that, or your your experience on the bonus depreciation part?

I Congressman, I I believe that the bonus depreciation, the full the full deductibility of the equipment is one of the greatest driving forces we are seeing in in our manufacturing and in fact our main street revival. And I think equally important is the permanence. This the Republican Congress made this permanent, so great certainty and the twenty percent pass through rate is also made permanent is giving small business permanence.

And could you touch on one ninety nine A? That's a big uh thing for a lot of

Uh, yes sir, it gives the average small business about seven thousand dollars more per year and the small business deduction cuts taxes for eight million small business owners by forty-six hundred and uh again What is important here is the certainty and the permanence. It allows the small businesses to hire, to invest, and plan for the future.

And then let me just touch on in my district, being in Florida, we have a lot of obviously seniors, one of the I think the fifth most seniors uh in the country in terms of that. And they're excited about this cut, twen- I think it's two hundred thousand seniors that I have in my district, but the number is a huge number across the country. Where is that at today, and I think more importantly to me, or one of the big things, is to making sure we're talking to a lot of our seniors because most of them are taking advantage but I my sense of it is not all of them are taking advantage. What are we doing to communicate with the seniors that haven't taken advantage of the opportunity?

Uh Congressman, I was just down at the villages in Florida, the lar largest retirement community, not in the United States, but in the world. And I cannot tell you the enthusiastic reception that the uh them being able to keep most of their social security they has made and the these these are not the well-to-do people uh maybe at the villages but in in general the when we saw the senior deductions sixty eight percent of the filers made less than a hundred thousand dollars and ninety six percent of the filers ninety six percent make less than two hundred thousand

Yeah, all many years I'd go to these hearings or different meetings that we'd be involved in, many times with senior organizations, and they al- always complained or thought about,

Mm.

what are we gonna address, we've paid taxes once on social security, we gotta pay it again. So that's a big deal, but I just wanna make sure we're doing everything we can to communicate with them and so they can take advantage of it. Most have, but there's many that haven't. Um and uh but thanks for your leadership and all you've done for the country.

Good. Thank you, sir. And we are, Treasury is working with Social Security Administration, uh, to make sure everyone is taking advantage of this.

With that, I yield back.

Thank you. Mister Doggett.

During your tenure as, uh, Treasury Secretary, has the IRS recommended that any taxpayer be granted immunity from an audit for their taxes?

Uh, uh, ag- again, one portion of that is the, uh, under litigation, so I'm not able to

Yes, sir. It isn't a question of being not able, it's being not want to. But my question is about,

Uh, no, sir. As as I said, there is litigation, so

thank you, sir, but reserving my time, my question to you again is, uh,

Definition of insanity, sir.

in the ordinary practice of the Treasury Department, has there ever been a recommendation that a taxpayer be granted immunity from an audit of their taxes?

Uh, sorry, what was that?

Same question. Has the IRS recommended that any taxpayer be granted immunity from an audit of their taxes.

Uh, again, I'm unable to answer that.

You can answer it, you refuse to answer. Can you tell the American people in the history of the Treasury Department, has there ever been a taxpayer who's been recommended to have uh immunity from an audit of their taxes?

Uh, has there ever been a taxpayer who had his tax returns released to his family and every employee's,

Thank you. So I'll take that as a no. Let me ask you,

every employee's? I mean,

sir,

Congressman,

since you say you're relying,

if you'd like to apologize to the President and all his employees,

thank you, I reserve my b- Rec-

I I I I would join you in that.

Maintaining my time, and since you refused to answer, let me ask you, since you say you're following the advice of the Attorney General, the former criminal defense attorney for Mr. Trump. As you know, the Attorney General cannot compromise a tax dispute unless it's referred to him from the IRS for prosecution or defense. Have you ever been involved in any way in a decision to refer a tax dispute to the Attorney General?

Uh, uh, again, I cannot comment on that.

You can't comment your argument here that you can't comment in this case. But that there is a turn there is a there there there is a turn in my privilege, It makes as much sense as President Trump saying that he cannot. I understand you want to talk over me, sir. but you're not answering the question because you may have defined insanity by referring to Einstein, but your appearance here today and yesterday in the Senate defines deception. And that's what you're doing to the American people. Isn't it correct, sir, that the financial management service within the Treasury Department must give approval? before any payment can be made from the judgment fund.

Uh, sir, w- the uh we administer the payments.

Yes, sir. You you give approval to it and

Uh, no, sir, we we administer them.

You you make a a sign off on them uh being

Uh, we we administer them just like if you tell your bank to wire money.

Did Brian, yes, sir.

Bank does not say do not pay you shouldn't pay your visa bill. All right.

Did Brian Morrissey, who had been only confirmed by the Senate a few months earlier as Treasury General Counsel, uh, do a good job for you? Can you answer that just with a yes or no? I'm not I Yes. Yes, he did. And as you know, uh, he abruptly resigned rather than be associated with his CD Trump slush fund deal, and didn't sign off on anything. Uh, sir, and and w- sir, Can you pledge to the committee? and and and and Wes, you are I'm asking you a question, sir, if you'd you'd listen to it. Can you pledge to the committee that you will assure that no retaliation occurs against the career IRS employees who wrote the twenty-five page memo asking the Department of Justice to halt action on this outrageous audit immunity deal.

Uh, s- sir, we follow the law.

OK, well will you follow the law in assuring the committee that

Uh, we always follow the law.

you won't retaliate against those courageous career employees?

Uh, w- we always follow the law.

What's involved here, sir, is the most corrupt deal uh in American history. Truly incredible that a president of the United States could come in and sue the people of the United States for ten billion dollars and then walk off with an immunity deal that no other American has ever had nor could they receive, and to get that immunity deal from his former criminal defense attorney, who he ha- he has appointed as acting attorney general. This is the kind of corruption that would permit the Trump family, if the Wall Street Journal is correct, that Trump earned five billion dollars uh from his crypto bills last year, to be total to pay them or not pay them as he feels it's smart to do. Uh, he made no complaint about the audits in his petition, and yet suddenly out of nowhere he's granted immunity uh in what uh some have said uh in a report would be a hundred thousand dollar benefit a hundred million dollar benefit to him uh you know that uh there is a responsibility of your department, to do audits of the president every year. A report of this committee indicates that only one was begun during the first term. Uh, what are you doing to assure that those annual audits occur this year, the first term, three years nothing? Has anything been done this year to fulfill that responsibility?

Uh, again, sir, due to IRS rules,

I'm not talking about

I- I- IRS rule sixty-one O three, which p- prohibits the discussion of taxpayer information,

It doesn't

and and the uh,

It doesn't prohibit your

this is this is how we this is how we got there with Mr. Littlejohn.

It Yes, sir. It doesn't prohibit you indicating what you are doing to assure complicity with the law

And I I don't think you want the automatic five years in jail, Congressman.

and with the practice, long-standing practice of the Internal Revenue Service.

I I am I am finding that I am following the privacy.

So I think we can assume from your deception today that nothing's being done, and this president is being treated in a way that no other president no other American citizen has ever been treated in an incredibly corrupt deal.

I would agree with that, sir. I would ag- I would agree he is being treated the way no other person has ever been treated.

I yield back.

Mister Smith.

Thank you, Mister Chairman, and thank you, Mister Secretary, for being here today. Um, I think these conversations are certainly uh enlightening and uh maybe maybe

Circular.

sometimes even entertaining to hear some of the uh items that are brought up, uh if I weren't so sad. But uh I appreciate many of my colleagues whom I respect uh speaking out against tariffs. Let me remind folks that after all the criticism of President Trump during his first term relating to tariffs, few other things too, but in this case tariffs, uh, unified democratic control for two years resulted in no action on tariffs and quite honestly, disengagement on trade altogether, that I think brought disrespect to our country and, and I think damaging, uh, in, in many ways, uh, but I'll, I'll, uh, move on here to talk more about, uh, tax, uh, and certainly the Treasury's recent, uh, inter-agency agreement with the Department of Education to address the ongoing, uh, ongoing ta- costs to taxpayers associated with the Biden administration's student loan policies. Last year I joined several colleagues in urging Treasury to rescind the waiver, which prevented collection on defaulted student loans. So this agreement takes an important step toward restoring accountability and protecting taxpayers. I certainly appreciate your p- your partnership in the effort. You know, the working families tax cut bill uh, wa- was very productive, certainly teed up by the Tax Cuts and Jobs Act from the first, uh, Trump term. And, uh, it's interesting, you know, in the meantime we had a bipartisan bill where we had many of my colleagues, both sides of the aisle, vote for so many things from the Tax Cuts and Jobs Act. And then when we even added more middle class advantages, whether it's Trump accounts, uh, whether it's a school choice, whether it's the tax relief for overtime, uh, likewise, uh, for, uh, seniors. I mean, the list goes on. But because there was no chance that President Biden would would sign that, um, they, they voted against it.

Hmm?

So when, when there was a chance that President Biden would, uh, could have signed a bill, now it didn't get through the Senate obviously, but when, when that were, uh, seemed to be the, uh, the situation, they opposed it. Um, so I I I just uh get a little frustrated when we have we can have good discussions here in this room, and uh legislate, I think it's important to note that there were so many inversions happening leading up to the Obama administration that even President Obama advocated for lowering the corporate tax rate. Now he he uh advocated a rate that didn't have enough support here. Uh, President Trump came in, he advocated for a considerably lower And we legislated basically right in the middle. And and it proved very effective economically, proved effective for growing revenues, uh and growing the, because the c- economy grows. So, uh, uh, anyway, I'm I'm excited about the Trump accounts because I think those are going to be consequential especially teaming up with the federal scholarship tax credit. Uh, appreciate my colleague, uh, Blake Moore working with me to, uh, make permanent the the Trump accounts. because I I think uh they are going to be very much appreciated by a lot of folks, few years down the road especially, but I think uh ev- even in the near term as people start thinking more about their financial future. Now a lot's been said about various things and and uh certainly the President, but I I know that there's been quite a bit of chatter uh from the other side of the aisle regarding the President's investments uh I'm just wondering if you could set the record straight on this. and explain how there have been mischaracterations mischaracterizations uh during during the process uh and mischaracterizations of the law perhaps.

Uh yeah I I wanna be very clear on this. The uh President Trump's investment holdings are maintained exclusively in fully discretionary accounts managed by independent third-party institutions who have sole and exclusive authority over all investment decisions including asset allocation, trading, rebalancing and portfolio management. They received no advance notice of trades, cannot alter or override the manager's strategies or or models, and un- unlike Congress, this was intentionally designed to maintain a clear separation between President Trump and the independent third-party investment managers overseeing his account.

Thank you, Mister Secretary, and and let me just close by saying that the American people are wanting us to have good conversations, thoughtful conversations, reasonable conversations, and and I think thoughtful and reasonable individuals know that what we did with our tax policy has been good. Thank you for your role in that, and I I want us to work together for the for the betterment of of our economy moving forward, uh just as the the American people would expect us to do. Thank you, I yield back.

Thank you, Mr. Thompson. Thank you, Mr. Smith.

Thank you, Mr. Chairman. Mr. Secretary, thank you for being with us today. Uh, you were here a year ago, uh, you came before the committee, and you closed your testimony by saying the president's bold leadership had laid the foundation for what you called a golden age economy. More recently, you said the economy could grow by at least three point five percent this year, and that Americans would see a non-inflationary boom. Mister Secretary, I've searched hard to find constituents in my district who believe that this economy is golden. In fact, many of them are struggling more today than they were the last time you were in front of this committee. Personal savings are shrinking, disposable income is down, and families are paying more and more for basic necessities. So I would like to ask you a couple of yes or no questions about this golden economy. Uh, electricity bills are up eight point five percent. Is that golden?

Uh, sir, you can ask me a question.

Yes or no?

You can ask me a question.

Yes or no?

You can't tell me how to answer it. So,

Okay,

I think it

let me put it this way, Mister Secretary, because you're obviously not here to answer questions.

I am here to answer questions.

You're here - It's my time, Mister Secretary. It's my time. Health insurance costs are up twenty-six percent. That's not golden. Child care costs are up nine percent. That's not golden. Gas prices are up nearly fifty percent. That's not golden. Grocery prices are still straining family budgets. That's not golden. Mister Secretary, working families don't feel like they're living through a golden age. And while H. R. One may have delivered modest tax cuts for some Americans, many families are seeing those savings wiped out by higher costs, everywhere they shop. Is that what this administration considers a golden age? And that's rhetorical, so you don't even have to try and talk over me.

I I I I I know what I'm talking about.

Secretary, Mr. Secretary, what should I tell my constituents when they ask about these costs? Farmers who are being hit by high costs of fuel and fertilizers who can't get their product to market because of the war in Iran. Tell them it's golden?

Uh, you should tell them that we've had two point six percent economic growth since President Trump took office despite the democratic,

These these farmer these farmers are pretty smart,

despite the, despite the democratic,

Mister Secretary.

well, no, people in California, the one person at least,

Reclaiming my time.

no, one person at least in California every two minutes,

These farmers are pretty smart, Mister Secretary, and they're not gonna fall for that line.

they leave, they leave California

I understand your unwillingness to testify and answer questions about details

as one person every two minutes. I I'm I'm happy.

regarding the IRS's settlement with the Trump administration due to ongoing litigation. But at the end of the day, your department, the Treasury Department, and specifically the IRS, is going to have to carry out its demands. And let me be very specific about what those demands are. The settlement says the IRS is prevented from raising any and all claims against the president with respect to any tax return filed before May nineteenth, twenty twenty six. So, Mister Secretary, as the head of the Treasury Department, you will be in charge of carrying out the demands of this settlement. So let me present a real uh true scenario for you. If on May eighteenth President Trump files an amendment to his twenty twenty-four federal tax return, and the amendment says, quote, " I'm owed an extra ten billion dollars," That's the amount uh that the he sued the IRS that I forgot to claim on my tax return. Is it your opinion that the settlement agreement signed by Todd Blanch, the acting Attorney General and President Trump's former personal attorney would require you to pay President Trump a billion dollars, no questions asked?

Uh, we will follow Justice Department's advice.

Okay, you won't answer that either. Do you think this is something that the American people should know? How can you sit here and not provide any answers to the American people?

Cuz I follow the law, Congressman.

Because it is astonishing to me that the president didn't know about this deal before it was signed. Of course he knew about it. He directed it. So why not cash out on his get-out-of-jail-free card? As I read it, he can absolutely file an amendment to his tax return and claim a giant tax refund. And you have to sit there and watch while he robs the treasury, and more important, while he robs the American people blind. That's as unacceptable as you refusing to answer questions posed to you by the members of this committee. Uh, yield back.

Mister Kelly.

Uh, thank you, Mister Chairman. Uh, Mister Secretary, thanks for being here. As you know, the meetings will continue until morale improves.

Well,

Uh,

the,

this is the beginning of the Charles Dickinson stuff.

uh, gi- gi- given that the Democratic, given that the Democratic House has a seventeen percent approval rate, Now I see why.

This is the opening of a Charles Dickens novel, is it not? So "It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity. It was the season of light, it was the season of darkness, it was the spring of hope, it was the winter of despair." How well that describes what we're going through. Oh, I will remind my friends on the other side that we had double-digit inflation, uh, in the prior administration the the president inherited one of the worst situations he could possibly do. The cost of gasoline, by the way, in June of two thousand twenty-two was the average was five dollars and sixteen cents a gallon. As of uh June fourth it uh it's now four dollars and fifty-one cents a gallon. So facts are a funny thing. Uh use the ones that actually uh are true or bend them to anything you want. Uh what I really wanna talk to you about though is part of what we did uh when we d- first did Tax Cuts and Jobs Act, it was something called Opportunity Zones. Um, and I'm gonna invite you to come to Erie, Pennsylvania. Erie, Pennsylvania was at one time a thriving city, but fell on very, very hard times. Um, but when we did the the Tax Cuts and Jo- Tax Cuts and Jobs Act with the Opportunity Zones, this is an- this encouraged private investment, not taxpayer dollars, but private investment going into areas where the government would have wasted its money, and does oftentimes, uh, but say to private investors, you know what? Using the tax code, we're gonna give you an opportunity to invest in something, uh, while other people would usually walk away from it. I gotta tell you, in Erie, in Erie, under the leadership of key stakeholders and lo- local leaders such as the Erie Downtown Development Corporation and the strategy of Erie refocus plan, the city committed itself to a goal of revitalizing its downtown waterfront while building on its industrial heritage. Using Opportunity Zones as a catalyst, Erie has leveraged more than forty million dollars in private investment. This investment created a hundred and ten new residential units, revitalized more than a hundred thousand square feet of commercial space, restored eight historic properties, and bought brought the grocery store to a neighborhood previously designated as a food desert. One of the things I I wanted to talk about because under this new plan, we decided, hey, you know what, we did some great jobs when it came to cities. Let's look at rural areas. So what I'm gonna ask you to do, if you would, please come to Erie, where you can see how these actually things worked in living color to real people in real time.

I, I

How we're revitalizing a community. Uh, the job you've done is incredible, by the way. Uh, the only thing I question What keeps you getting up in the morning and coming into things like this, when you know all that work that you do, all that time that you spend, all your staff works to make it better for the American people? how about this idea of it being a republican idea or a democrat idea why don't we just look like what's best for america

well the uh representative first of all uh i have heard that erie is the poster child in a great way for opportunity zone so i look forward to coming and visit and i look forward to visiting the rural areas uh in in your district and also as i said earlier uh many many Representative senators from the other side of the aisle have called me to ask for guidance on opportunity zones I pointed out that they voted against them but that is why I come in to help the American people we can overcome partisan differences that they voted against them it is in statute now and we will make it work for all the American people you know what and I I would I appreciate that so we'll get with you now because I have two friends in the senate right now that represent

Pennsylvania, they are sometimes what have been described as polar opposites. They're not. So between Senator Fentim and Senator McCormick, we have two people in the Senate now working together to do the best things that they can do for the state they represent and the nation that they work for. Uh, I think if we could twist things around, and unfortunately elections get in the way of us doing things that are actually uh beneficial to the American people, we uh we tend to to work on a parley spe- a par- a party spectrum rather than uh the people we represent. I, as I said, I represent three quarters of a million people. Uh, none of them are, it's not an all red, it's not all blue. And in fact what discourages me is too many of our people who live in the area no longer have faith. And they don't even register to vote. But please, we're gonna invite you. We're gonna invite Senator Fetterman, Senator McCormick, we will get people there to sit down with you. There is such a wealth of opportunity taking place right now. The figures don't lie. Sometimes the liars can figure, but figures don't lie. Thank you for doing what you're doing in your private life, to walk away from that, to walk into this. When they first described it as a swamp, they now had no idea how deep the swamp has become. Thank you for being here today and thank you for your dedication to the United States of America.

Thank you, Mister Larson.

Thank you, and thank you, Secretary, for uh joining us here today. It's always kind of a unusual when you start a hearing and are instructed what you can say or can't say in an open and free democracy. But, uh, having said that, um, you mentioned in your testimony core inflation a couple of times. What's the difference between core inflation and inflation?

Uh, the many people believe, or it is, in general, uh, energy prices and food prices, which are much more uh fast moving and I I would say that energy prices will roll down when the saran conflict ends

so did is gasoline considered part of core inflation

yes sir

it is so those remarks core inflation reflects gasoline prices

core inflation they reflect the underlying trend in inflation and whether that inflation has become endemic to the system as it did the during President Biden's time.

Has the war in Iran had anything to do with uh core inflation?

Sir?

Does the war in Iran have anything to do with core inflation?

Uh.

Uh you can't answer that or either?

No.

Or is this a is that are we precluded from asking that?

Well, I'm not sure what the question is.

does let me make it as simple as again does the war in iran

well well well well

are you with me

uh well

does the war in iran

thus far so

cost have witnessed the rise in gas prices as a cost

well again that is the regular inflation and gas prices have gone up which i believe will be temporary the core core

so gas prices have gone up but you believe they're temporary

co core core core inflation It has dropped point five percent since President Trump came to office.

Jeez, you know, when I'm home in my district, I'm gonna just tell those people, jeez, you know what? You've missed this whole thing. Don't you understand core inflation? You guys are better off. I mean, these gas prices. I I don't know what you people are thinking out there. For God's sake, you know, they're just you should be doing cartwheels in the street over the price of gas. So what is the administration's plan to lower gas prices?

No, no, no, no. Uh, we've taken The uh m- many states.

Are you in favor of eliminating the gas tax?

Uh, the uh we have moved to we we we we

Are you in favor of eliminating the gas tax?

we would like to work with

Are you able to answer that or is that not answered already?

Well, if I'm not interrupted, I can, Congressman.

Well, I'm waiting for your answer.

Uh, we we have moved, we have asked Congress to move to eliminating the gas tax. That is done through statute.

You have moved that. So you're in favor of eliminating the gas tax.

We we have asked for that.

So we can join bipartisan today because you're in favor of it to eliminate the gas tax.

I Again, the White House has asked for it, sir.

They have.

Why isn't it before the committee? For a vote.

Wait.

I I don't run the agenda.

Well, it's good to hear that, uh, I think we need to make a decision on this. we're in we're in favor of something that we can work on bipartisanly that, uh, will help relieve, uh, people, uh, who need it the most. Um. Forgive me, but people in my district aren't doing cartwheels over this economy. They haven't seen the impact that you claim that they're all receiving. Uh, people hear a lot of rhetoric, et cetera, but that doesn't pay their grocery bills. That doesn't pay their heating costs. That doesn't put fuel in their tanks. That doesn't help them get through the day-to-day grind of their lives. And so coming here and filling us platitude in telling us how great will we should be to the Trump administration for everything that it's done uh

Well, Congressman

Is this war responsible for any of this?

Co- Congressman, Congressman, food at home is up two point five percent since President Trump took office,

Are we at war currently?

which which which which is twice. It is up twice that much every year under the Biden administration.

Are we at war currently? Are we at war currently?

that the conflict has been halted.

The conflict has been halted. I s- uh, so we're not at war.

There's a special military.

I

So our military is not involved, we're not at war.

A- a- a- a- again, if - if you would like for me to call the secretary of war, I can ask. I am the secretary of the treasury.

So as part of the administration, and as part of this, we're not at war.

I - I can

How in God's name, if we can't answer any questions at all, And I don't know, maybe there was a special orders where we're not allowed to these these questions. Or not. We ought to make that clear. Are we at war or not?

I

I'm asking as relation to the cost of going up with for g oil and gas. That hasn't risen?

Well

Has it risen because of the war?

Uh it did rise because of the conflict, yes sir.

The the conflict. So that's what we call it. Our people go into battle and uh lose their lives in a conflict.

Mister Larson, your time has expired. Mister Schweikart.

Um, thank you, Mister Chairman, and just um uh uh uh uh Mister Secretary, you were already heading there. As everyone here I'm sure knows, um PCE there's actually um trimmed, there's which Kevin um new Sec- or Head of the Fed uh prefers, there's actually four or five ways you do balancing on the calculations. So, if any of you want joint economic actually we have a whole chart of how those calculations work if anyone would like it.

Well, well no, so tho- those are great facts and they're inconvenient. And food prices, food at home has risen two point five percent since President Trump came into, came into office. It averaged more than five percent, five percent, the uh, uh, under the Biden Warren economy. And I've got a list here that President Trump posted, but no one wants to talk about it. Last year all we heard was " eggs, eggs, eggs". Eggs are down ninety percent.

I-

Avocados are down nineteen percent. The

Mister Secretary, you will find we

we we we we which is probably avocado's probably more popular on the other side of the aisle.

Yeah, Mister Secretary, you'll find we often choose whatever number um works best for the social media posting we're gonna do in an hour. So, welcome to Congress. Um, a a a a conversation um we've been having actually with um some of your staff and some of the Waise Means staff, is something that often never comes up but we we're going to have to understand it, and find a better way to document it. Um, we calculate about seventeen percent of the US economy now is in the tax-exempt space. And within that space, um, those who receive the benefit of tax exemption, the basic concept is, here's the community good you're doing for not having to pay taxes. OK. Um, there's something you're an expert on, the nine ninety form that documents to the IRS, to treasury, to Congress, what is that community benefit. Um, I know your team has been working on this. I know some of the IRS team, we've been working on it. Is there a way to come up with a much more robust universal form so we can understand are these tax exempt organizations meeting their societal obligation, and if they're not, We can help them meet that, but we don't have enough information today.

Uh, it's a great question question, Congressman, and there are many tax exempt organizations, a large part of the economy are hospitals and health care services, so we should look whether they are meeting the needs and are in fact non-profits. But your question in terms of what is going on with these non-profits, the IRS has issued guidance for form nine ninety that nonprofits, just as banks must KYC, know your customer, we the uh are telling the dir- the directors of these foundations, of these institutions, you must know your grantee. So KYG. If your grantee, the is, if the money is being used for violent activities, you as a trustee As if fiduciary or in trouble. If it is being used to take away people's civil rights, you are in trouble and the nonprofit status, the uh, is in jeopardy.

Um, my team looks forward to continuing to work with Treasury on making that more robust, so we actually understand both those that are using nonprofit tax exempt as funnels to bad acts, but also are they meeting their community obligations? Um, one that you're probably not gonna get as a question from anyone else. Um, we have a fixation of debt management. You know, we're the responsible, as policymakers, we're responsible for the debt, not the administration. We do make the policy. What can we do as members of Congress, joint economic committee, ways and means committee, to help you convince the markets You know, please, by a tenure note, please, um, we're, we have s- some visu- you know, the, the, the bil- bil- visibility to see where we're going. Um, I do have some concerns of in the future where the entire world is binging on debt, that we have some stressed auctions. What do we do as a country to actually not have that happen to us?

Uh, so, since President Trump came into office, uh the US treasury market has been the best performing uh developed market but that that is not assured. It it is assured that we will have the treasury will have a regular and predictable issuance cadence but what we must you know let our the uh borrowers know, people who are buying treasury bonds, whether it is US households, the foreign central banks, and everyone else in between, That is that we are serious about the getting our debt and deficit numbers under control.

That is perfect, Mister Secretary, and with that I yield back, Mister Chairman.

Mister Davis.

Thank you, Mister Chairman, and thank you, Mister Secretary. Secretary Benson, as of April eighteenth, taxpayers received about three point four million delayed refund letters. Illinoisans received a hundred and ten thousand, Texans, Floridians and New Yorkers each received over two hundred thousand, and Californians received four hundred thousand. Almost three months ago on March ninth, Representative Sewell and I asked you for basic information to demonstrate that Americans are actually getting their delayed refunds. Last month, I requested a meeting with the appropriate staff at the IRS or Treasury for this information. It was not until this morning that I received a response from Treasury. And although the letter contains some high level information, it is insufficient to reassure me that Americans are receiving their refunds quickly. For example, The information in this morning's letter is substantially outdated. Today's letter cited two point two million CP five five three E notices when a separate document you sent me a few weeks ago cited three point four million notices as of April eighteenth. Also, the information in today's letter fails to convey the current number of unique taxpayers whose refunds were delayed. Nor does today's letter give a clear understanding of how quickly taxpayers are waiting on their delayed checks. So, Mister Secretary, could you tell me when, or before June eleventh, will you or your staff meet with Representative Sewell and me to walk us through the evidence that taxpayers with delayed refunds received the funds owed to them.

Microphone.

I have not seen the letter, that I will follow up on this, and the the delays that you are talking about are for taxpayers who did not file electronically we had But ninety-eight percent of taxpayers file electronically. They receive their refunds within twenty-one days. It sounds to me that the out of the hundred and thirty-four approximately hundred and thirty-four million tax returns that we received, uh, that the April number would have been the, uh, un-

Thank you.

And we are at two point two.

Thank

So we are working through it, and much of that has to do with verification, lack of addresses. So we look forward to working with you on that because we are committed

Well, thank you, thank you very much.

to people getting these voluntary refunds quickly.

Well, let me, let me just continue. Uh, Mister Chairman, could you assist me to make sure that we uh, the American people receive the information, three point four million delayed notices, are getting their refunds expeditionally, and also I'd like to submit for the record a state-by-state breakout provided to me by the Internal Revenue Service where three point four million taxpayers live and whose refunds were delayed as of April the eighteenth.

Without objection.

Thank you, Mr. Chairman.

And and Congressman, what was that number last year?

Uh, three point four million.

No, no, no. I I meant for the previous filing season. a- and the year before that.

Well, uh, I don't know the number for either one of those years, but let me move to my last question. I understand that this Southern Poverty Law Center has been indicted. And let me ask, is the Internal Revenue Service involved in that activity in any way?

Uh, uh, again, that's ongoing litigation, but that would have been done It was I read in what I know is what I read in the newspaper, and that was the Justice Department and the FBI.

And internal revenue is not uh urgent or suggestion to any of the entities that they may lose their tax exemption if they contribute to the Southern Poverty Law Senate?

Uh, aga- again, there's ongoing litigation, but that's driven by the Department of Justice and the FBI.

Thank you, Mr. Chairman. I give back.

Thank you, Mr. LaHood.

Thank you, Mr. Chairman. Uh, Mr. Secretary, welcome. Thank you for being here today. Thanks for your service. I want to touch on affordable housing. I think collectively, um, as we travel back to our districts, we continue to hear about the lack of affordable housing. And I would describe it as a rural, suburban, and urban problem. And last year in the working, um, family's tax cut bill, we included a number of provisions on affordable housing. And one of those was my bill that was included in there on the affordable housing tax credit. And as you're well aware, one of the most significant barriers to economic success in our communities is housing. And so in the working families tax cut bill, uh, we included the affordable housing tax credit, which includes a permanent twelve percent increase in the nine percent allocation of LIHTC credits beginning this year. Independent analysis have estimated that this will lead to the development of more than one point two million more affordable homes nationwide over the next ten years because of what we did. Um, from your perspective and the Department of Treasury, um, what will the expansion of the affordable housing tax credits, um, mean for working families struggling to afford housing?

Uh, I uh, the the LIHTC provision specifically gives great predictability for investors and builders who want to go into the market, and I think we've already seen a pickup eh in in those areas and with this program.

And, Mr. Secretary, what do you see for, as we uh try to address this problem, other um mechanisms within Department of Treasury or legislatively that we ought to be looking at?

Well, there are two housing bills, w- one one in front of the House and one in front of the Senate, and uh that seem to be languishing.

Um, I wanna switch topics. Um, I also, beyond being on the Ways and Means Committee, I serve on our select committee on China, which is a bipartisan committee focused on how do we win the strategic competition against the CCP. And I also serve on our intelligence committee. And I wanna focus on forty-five X. Um, and that's a provision in the tax code. And so, um, last year in the working families tax cut bill, um, we included i- the foreign entity of concerns, restrictions, um that pertain to curbing Chinese technology by manufacturers and mandating in that bill that they operate fully independent uh companies here with no reliance on Chinese entities despite these clear requirements recent media reports indicate that many manufacturers continue to depend on the active support of Chinese engineers overseen by the C C P uh security officers embedded in their US facilities undermining the objective of fully uh, transferring operational knowledge of these technologies to U S companies. Um, so, Mister Secretary, what is Treasury doing to address and prevent uh, Chinese uh, penetration and involvement in these companies receiving the forty-five X tax credit?

Uh, so we, we are polling the companies. We are asking for a verification that this is not happening. And whenever we receive a report, we investigate it just as uh with cipius cipius is self-reported uh but when we discover transactions that uh we believe should have been reported then we can go back and investigate those transactions

and and to your knowledge have any of those investigations led to a fruitful prosecution or holding somebody accountable

uh i can get back to you i can have my staff get back to you but i can tell you it has been very robust and you would have seen that recently the fcc uh banned uh Chinese drones and routers and with the connected auto mandate that electronic systems in American cars cannot be connected to Chinese entities.

Thank you, and I'll look forward to the follow-up with you and your team on this. This is something obviously we gotta be heavily focused on. Um, lastly, in my remaining time, I just wanna focus on digital service taxes. as it relates to Canada, um, a- and i- may- maybe obviously we have concerns. We credit the administration for what you've been able to do on DSTs uh in Europe, um, but there's still some concerns uh with our Canadian friends. Can you comment on where we're at with that?

Uh, we - we are pushing, whether it's Europe, whether it's Turkey, whether it's Brazil, whether it's India, uh, whether it is Canada, we are pushing back on these digital service taxes. We - we have the greatest technology and innovation ecosystem in the world, and they cannot take advantage of our companies and they have four, their treasuries. It is a ver- they are very interesting, they are very uh ripe targets because they are profitable, they are well-run, and they are in demand, but we cannot have this. Uh and we in every trade negotiation or every trade discussion with the Canadians we bring this up.

Thank you, Mister Secretary, yield back.

Miss Sanchez.

Thank you, Mr. Chairman. Secretary, nice to have you back before our committee. Um, Mr. Secretary, do you believe that all Americans should follow our tax laws?

Uh. Yes, Congress.

Yes, good, so do I. And do you believe that for those Americans who break our tax laws, they should be audited or held accountable?

Well, I think there are two things there. An audit is not a result of breaking the law.

Yes or no, simple question.

Well, well, well, no, it's not a simple question.

Do you think

It's a two-part question.

Okay, then let me break it into two.

I- if you're asking me,

Do you think they should

if you're asking me should every taxpayer be audited,

Please don't interrupt me. Please answer the I came here for answers.

I

If you came here to waste time, I'm gonna try to make sure you don't do that. Do you believe that people who lie on their tax returns should be audited?

Yes.

Okay, do you think that people who break our laws should be held accountable, our tax laws?

Yes.

OK, thank you. Very simple. Not a hard question.

No, but

I'm glad we agree. So why is it that you are allowing President Trump to have complete immunity from being audited?

Uh, ag- again, I'm gonna have to refer you to my previous statements and I'm

What was your previous statement, sir?

that I am unable to comment on any of the ongoing litigation.

OK, can you name the ongoing case concerning President Trump's immunity from audit?

Sorry?

Can you name

Uh, there there there are three cases,

Can you name them, please?

yeah, that that that are out there now, and I will be happy to get them back get back to you on those because, again, I am not a lawyer,

OK.

we would represent we are represented by the DOJ.

Great. You said that you can't because there's ongoing litigation. You'll get me the name of the ongoing litigation because the only ongoing litigation that I know of is surrounding the one point eight million dollar slush fund, which has already been suspended. The fact is that the judge's ruling in the litigation that references that slush fund only addresses the anti-weaponization fund. It doesn't even address Trump's immunity from audit. So I would like to ask unanimous consent to enter into the record the judge's order in the Floyd versus Department of Justice case.

Without objection.

Thank you. Um, now, secretary, you said you're not an attorney. Is that correct?

Mercifully.

OK, well I am, and I'm actually proud to be an attorney and know the laws, and I know how to read a judicial ruling. Furthermore, I know that since nineteen sixty-two, the Supreme Court has held that ongoing litigation does not prevent someone from testifying in a congressional hearing. So once again, I'm going to ask, why are you allowing President Trump and his family to have complete immunity from being audited?

I a- again, since you're a lawyer, you will understand that the US Treasury and the IRS are represented by the Justice Department and the Acting Attorney General.

Yes, but I just mentioned a Supreme Court case that doesn't bar you from testifying. I- i- it's pretty clear to me, though, however, that you're not interested in answering questions, you're interested in arguing. Let me ask you this question. If President Biden amended a prior tax return and claimed that he was owed one billion dollars, Do you think that that would be audited or should it be audited?

Uh, I'm not gonna be uh talk about any, any, the uh specif- I'm I'm not gonna I I am I am here,

Because you're not really here to answer questions. I I don't understand why you wouldn't audit that,

I can I you you you're here

and I don't understand why you wouldn't do the same for President Trump. So, the ruling

Uh, do you have specif- do you do you do you have specific knowledge of an audit of President Trump?

the ruling by the Justice Department, excuse me Excuse me. It's my time.

Do you have specific knowledge?

You're not here to ask me questions. I'm here to ask you.

Uh, uh, again, I imagine you have the Dou- Justice Department phone number. I would suggest you call them.

Mm.

I I'm not the one that runs the U. the Department of the Treasury or that oversees what is happening with this immunity,

Yeah, and I I I I'm not the one either.

that is has been granted.

We followed in we followed the instructions of our lawyers and we we obey the law,

And and and And I I I hope that you're proud of your performance today,

Representative.

Mister Secretary,

Well, well,

because I think

I I hope you get some social media clips.

I think it's pretty safe to say that this is probably the most corrupt Treasury Department in our nation's history. And while you while you dance around questions to protect Trump,

I am going to have to take exception with that. That is a slanderous

Americans are suffering in Trump's spiraling economy. But that is a slanderous statement. And the um Inflation is now rising faster than average hourly wages. No. Gas prices are at an all-time high with the war in Iran. The cost of groceries has risen three point two percent over the past years. And prices on most goods have gone up because of Trump's tariffs. So I don't see how you could call that anything other than a failure of the most corrupt Treasury Department in history.

Your time has expired, Ms. Sanchez.

You know, I I I I'm not I'm not gonna take, I'm not gonna take Thank you. My time has expired.

Mary, I would love for you to respond to, um, the accusations

I would like to hear

at your department because I think you are due the opportunity for that.

Uh, the Congresswoman is slanderous. She has nothing but un- via, but the unsubstantiated opinions, and I will not s- stand for that. There is nothing corrupt. We, the, we move at the highest levels, And just because she cannot get the answer she wants, if she would like to give me facts, she seems long on facts, the short on facts, long on hot air, and I will not stand for that.

You're just saying, you're just repeating my errors.

Yeah, that's great.

And I'm submitting it after the record.

Disgrace, disgrace to make a remark like that.

Mister Arrington is recognized.

Apparently my colleagues had a sudden uh interest in the rule of law. I wonder if you asked her if she thought illegal immigrants should be detained and deported or caught and released, what the what the answer would be.

Well, uh and Congressman, and two, on inflation, I am not gonna take firefighting advice from an arsonist.

Well, Mister Secretary,

They torched the American people twenty-one point five percent inflation.

Mister Secretary, maybe we ought to ask the question, should the sons of of presidents who are who who have multiple conv- uh felony convictions,

That was a concern.

should they be held to the same standard as the American people in terms of crime and punishment? I wonder what the answer to that question would be. Let's let's not veer off. Apparently wages and take-home pay aren't the only thing up in this country. Uh, irony and hypocrisy is at all at an all-time high among uh my Democrat colleagues.

Well, sir, now now now we now we see why someone leaves California every two minutes.

Uh, and that hypocrisy and irony starts with uh questions about price increases. It was the uh failed economic policies, one self-inflicted failed economic policy after the other that created the worst inflation crisis in in a half a century. Unbridled spending, if you add the hikes in interest uh uh uh uh rates, it would be about twelve trillion dollars in deficit spending. Waving work requirement for able-bodied adults on welfare. Uh, giving welfare and health care to illegal immigrants with the stroke of a pen by President Biden. Layers of taxes. on American competitiveness, uh layers of regulation on our small businesses. And you know what? We pay a premium right now and we will temporarily to defend our country, our children's future against a nuclear Iran, against a a a radical terrorist regime where we are under imminent threat, we will pay a premium at the pump. But we but but gas prices, we're at an at a at a low, two decade low in terms of disposable income. We had gas prices before the conflict below three dollars. President Biden and four years of Democrat policies, gas prices went from three thirty to five dollars. Now, we pay a premium for national security in times of conflict, and when we have imminent threat, we're trying to stave off another addition, a nuclear power to the axis of evil. But the premium that the Democrat policies imposed on the American people was for what? A mandate for electric vehicles? What did we get for that premium? We got hundreds of billions of dollars. It was supposed to be two hundred billion. Eight hundred plus billions of dollars in, in giveaways. Corporate subsidies for green energy. That's what the American people got. You know, they got higher energy prices. higher electric bills because of this radical climate agenda, the green new disaster, uh, and that's - that was the trade-off from my Democrat, uh, colleagues. So, um, a little context to this conversation I think is helpful. The results as you know,

Right.

Mister Secretary, were that the American people every year were losing three thousand dollars in wages. That they had a twenty-one percent regressive tax hike. Twenty-one percent. They were losing fifteen hundred dollars a year. I mean, are we in the golden age? Well, relative to the dark ages that we were thrust in by these failed policies, we are at the dawn of a golden age because wages are up, take-home pay is up, GDP you said is two point six percent. Well, that's a percent over what CBO said after we passed big beautiful bill. And on a, uh, throughout a, uh, on an annual average basis in a budget window, that's three trillion dollars to reducing the deficit, which may be why the deficit was reduced over ten percent in the first six months of this fiscal year compared to last fiscal year, because we actually controlled discretionary spending and have saved up to now almost a half a trillion dollars. It's because Republicans actually cared. about not frittering away tax dollars, and we rooted out waste fraud and abuse to a tune of over a trillion dollars, because we had quadruple revenue from having restructured world trade order, and l- set a level playing field for our farmers and manufacturers. Because of all of that plus the growth, we have had a reduction in the deficit to GDP for the first time in almost a decade. I'm out of time. I think you're doing a great job. Keep it up. Don't listen to the noise.

Well, I I don't see. Look, they they don't wanna talk about how they voted to cut the child tax credit in half for forty million people voted for higher rates on low and middle income families, for five million five trillion dollar tax hike. And if I were the Democrats, this side of the aisle, I would be terrified how many Americans applied for no tax on tips, no tax on overtime, reduced taxes on social security, and deductibility of auto loans.

Seven and a half million no tax on tips. Twenty nine million over.

Time, Mr. Mr. Arrington, your time has expired. Time, Mr. Mr. Arrington, your time has expired.

Unbelievable. Keep up the good work, Mr. Secretary.

Thank you. Miss Delvene.

Thank you, Mr. Chairman, thank you, Mr. Secretary, for being here. Um, last year, one of President Trump's first actions was to put his billionaire donor, Elon Musk, in charge of the so-called Department of Government Efficiency. By the end of Musk's short but destructive tenure, um, Doge had nearly quadrupled its original budget. lost taxpayers hundreds of millions of dollars in estimated interest and fee revenue, and paid two hundred thousand federal employees roughly twenty-two billion dollars to stop working. Doge was a massive failure. It turns out moving fast and breaking things and having no clue what the heck you're doing, um, is not the most efficient way to govern. Unfortunately, Doge's destruction wasn't limited to wasting taxpayer dollars and gutting the federal service. Doge staffers also abused their position to gain access to taxpayers' sensitive private data. Mister Secretary, on January thirty-first, twenty twenty-five, you personally granted Doge access to one of the Treasury Department's payment systems at the Bureau of the Fiscal Service. This database houses Americans' most sensitive data, including social security numbers and bank account information. Shortly after, my colleagues and I requested the GAO review Doge's unprecedented access critical payment system. GAO completed that report last month and I asked for unanimous consent to insert it in the record.

Without objection.

Thank you. Um, GAO's audit determined that a Doge employee was inadvertently granted temporary access to create, modify, and delete data from the payment system. Mister Secretary, you failed to impose basic safeguards that left millions of Americans' personal data. vulnerable to unauthorized access and abuse. And so my question for you is do you take responsibility for that?

Uh, I

And if what specific managers, if any, d- have you taken afterwards to protect the affected individual's data and rebuild confidence in your department's handling of sensitive information?

Uh, uh, again, the uh, would you care to look up what is the inadvertent name? What what what what what what what what what what is the inadvertent?

Did you d- have you taken uh but you're in charge, are you you are responsible for this. Do you take responsibility for that?

The, the, I,

Do you take responsibility?

I, I, I, I will take responsibility, and again,

Okay, and then what has been done to make sure that can never happen again?

and, and, and, and, and, and, and, and, and, Congresswoman, it was read-only. They had no ability to edit.

What has happened to make sure that never happens again?

The, we, we have the, just as we have at the IRS, we have tightened up all protocols on systems.

Um, I guess that's not very specific, but um the GA also found that a Doge staffer sent an unencrypted file containing USAID payment information and individuals' names to external Doge personnel at the General Services Administration. Soon after it was reported no disciplinary action was taken, despite the employee's failure to protect federal and non-federal employees' sensitive personal data and comply with security requirements. So again, Mister Secretary, when employees who violate IT security rules are not held accountable,

I, uh, wh- wh-

What does that message send to agencies?

Why - why - why are you bringing up -

And why don't you hold someone accountable?

why - why are you bringing up USAID with me?

Because a DOESh effort,

Why - why -

GAO found that a DOESh had the payment information,

What - what does - what does that have to do with me?

payment information.

What is - U- USAID, I do not oversee. I wear many hats in this administration. Not one.

And this is still conti- this is a file containing payment information. Um, are you not in charge also of the treasury?

They, that has USAID, that has nothing to do with us.

But payment information has nothing to do with it.

I I I again, the uh it was not sourced at the treasury, why why are you bringing this up with me,

So GAO provided six recommendations to address identified weaknesses,

I can't follow it.

including ensuring staff agree to comply with IT security rules and configuring systems to detect and prevent the transmission of unencrypted payment data. The report states that the fiscal service, again the fiscal service, part of your part of uh your agency agreed that three of the recommendations or agreed with three of the recommendations and did not state whether it agreed or disagreed with the other three. So, Mr. Secretary, can you confirm Treasury's position, this is part of your of um of your purview, the Treasury's position on all six recommendations and if you agree that they're warranted, please let us know, and if you disagree with the recommendations, please explain why.

Uh, again, I don't have a copy of the recommendations in front of me. Your office did not share them in advance. We'd be happy to get back to you, that we would obviously agree with the ones where we've already agreed.

So I hope that you understand that these are findings from the GAO about ensuring that information is protected. Um, uh, and again, we have seen access to taxpayer information at leaks.

We we we we have

What are you doing to address this?

we we the uh I

And are you taking responsibility? People don't have faith that the

I

access has been given against the law.

Well, ag- again, the President Trump and his family and employees of the Trump organization, four hundred thousand people had their tax returns stolen the uh at the IRS.

You are in charge. What are you doing to prevent that American's people's

Uh I I I know, a- and the uh

sensitive information has been leaked outside and you have

Mr. O'Benny, your time has expired.

Again, the uh w- w- we we have tightened the protocols, we have tightened access,

And you have said nothing specific of what you've done to ensure that

we have tightened

Mr. O'Benny, your time has expired. Mister Estes is

Good to see you, Congressman.

So frustrating.

Thank you, Mr. Chairman. Uh, Secretary Bes- Besant, uh, thank welcome for blazing means and, uh, thank you for being here today. Uh, and I, Mr. Secretary, I want to go back to last year when you were here before the committee and the conversation turned to discussions around OECD pillar two. There's much discussion about how Congress and the administration can work together to stop the taking of our tax authority by other nations, and losing over a hundred and twenty billion dollars from the US Treasury over the next ten years. I'm proud to say we're in a much better spot than we were a year ago, thanks to a lot of the hard work by uh your Treasury folks and and the effort you got done there. Um, side-by-side agreement that you and and your team negotiated is an important agreement uh that protects the American tax base from foreign countries, looking to use our economy as an ATM for their own budgets. I know some members of this dais and and their allies in the liberal press believe that this agreement gives successful American companies a free ride, but that's simply not true. The reality is President Trump and the Republicans in Congress have done so much work on both the working family tax cuts and the Tax Cuts and Jobs Act, uh to make the US tax code more competitive and cement the US as a best place to do business. Uh, Mr. Secretary, can you tell us uh a little bit about how corporate tax revenue has changed, since uh we passed TCGA in two thousand seventeen and thanks to our more competitive tax code?

So it's a combination there, Congressman. We we are seeing a a pickup in corporate revenue, but importantly where we are seeing the deductions is for the full expensing, both for equipment and structures, both factory structures and farm structures. So you can think of that when when you see that deduction taken, you are actually creating the future tax revenues by building up the um, productive capacity of our country, and that increases productivity. So, you know, on that side. And on the other side, pillar two, that the getting getting this sorted out and making sure that the tax revenue comes into the US Treasury was essential. The the US, they first instituted the global minimum tax and the Biden administration wanted to supplicate us to other countries and a you know, internationalist tax regime that we were having none of.

Yep. Thank you for doing that. Uh, can you give us a little update on, uh, how the co- some of the countries are implementing the side-by-side agreement and and while we're keeping them moving forward on that?

Uh, uh, we're we're finding a very, very good partnership, and we are implementing it, uh, via our partnership with the OECD and our constant interaction with them.

Yep. Well, thank you, and we're gonna continue our our work to trust but verify that that process continues and other countries uh actually provide fair treatment for US businesses. Uh, I wanna thank you for your comments and your work you're doing on the digital services taxes as well. As you mentioned earlier, I mean, uh, a recent analysis that I've seen is that American businesses uh pay nearly pay nearly three billion dollars a year in foreign DSTs uh as of now, and it would siphon off a hundred and seventeen billion dollars in tax revenue over And we we we need to continue that effort and I appreciate appreciate your work in that regards. You know, we in the United States, both in Congress and Treasury, uh, plan to commit to protect our tax base from foreign attempts to take it. And while we welcome negotiation and engagement Yeah, it's right. based on the foundational principles of taxation, uh, you know, our resolve is absolute. We want to make sure that we continue to to provide every tool available, including ones that we may have put on the shelf uh recently, uh to to ensure our competitive on world stage

tax taxes yeah

and this is true whether it's you're talking about germany with their section forty nine or whether you talk about italy or mexico they've been trying to weaponize tax audits are raiding offices and homes and threatening criminal charges against uh against us companies i wanna switch quickly to uh domestic tax code you know everyday americans businesses and individuals uh tremendously benefitted from our historic tax relief right right that's a good it's a good lot of them

hmm

you know, ninety-seven percent of taxpayers, uh, uh, received a tax cut this past filing season, thanks to no tax on tips and no tax on overtime and increased standard deduction and enhanced senior deduction. And these are American first provisions that, uh, have put more money in the pockets of hard-working Americans.

Trouble.

I want to recognize the some of the changes and as you've mentioned uh in the working family tax cuts had with manufacturing, where there's research and development and, uh, capital expenditures that have been able to to put in place for long-term growth. Um, have you I I only have a few seconds. I don't know if there's some comments you wanna make about the economy and what you've seen over the last year.

I have a Congressman, I I would say the economy is very strong. We are experiencing a short-term elevation in prices due to the Iran conflict. That will come down. The what the the other side doesn't wanna talk about is Job growth is strong, except for April we have seen real wage growth every month, every month since President Trump took office.

Yeah.

And I want to talk about that two point six percent economic growth despite the shutdown in the fourth quarter of last year and despite the Iran conflict. We will get on the other side of this and the we are creating jobs and importantly, Congressman, these are jobs for Americans, not the five, ten, twenty million illegals that flooded across the border during the Biden administration.

Well, great. Thank you for being here. Mr. Chairman, I yield back.

Mister Schmucker.

Thank you, Secretary, for, yeah, we're here. Uh, thanks for being here. Uh, very much appreciate your leadership and I think you you just cited some figures about the economy that are really important. Real wages have been growing under this administration and after the implementation of the the bill that we passed. Uh, very different from what we saw under the Biden administration when people were really feeling the pain of the rising prices. because wages didn't keep up. So, uh, grateful for, as I said, uh, your leadership. Uh, one of my priorities, um, in the big beautiful bill was the section one ninety-nine deduction, uh, making that permanent. I've heard from businesses about how that's infected, uh, affected their investment decisions when they have that permanency ahead of them. So, and their, uh, uh, how they're doing is really important to every community, the, uh, uh that they reside in and so i'm uh very proud of of what we've been able to accomplish i do wanna very quickly another of my priorities was uh direct primary care of employers in my um area using direct primary care as a way to provide better access to healthcare we wanted to ensure that uh contributions to hsa's by employees are uh tax deductible that was in the bill we also wanted that to employers and I think there's some uh question about that as uh Treasury is putting together their uh guidance on that, so I just wanted to hear from you whether you agreed and whether you could assure us that Treasury's guidance will allow that to be deductible for businesses as well.

Uh we we are working on that and that has been HSA's has been a very powerful uh tool, and we've seen the the take up thirty I think thirty-seven, forty-something percent, so we will work on that and get that guidance out, sir.

Yeah, I I I hope that we go with that initial intent, which was to make that uh deductible for employers as well. So thank you for that. Uh, I wanted to um you had uh I have to pull this up um a statement you made um in regards, or during the discussion uh with uh Sh- uh Schweikert uh in regards to the debt and the markets that I thought was really good, and I wanted you to expand on that if you would. Uh, you said, and I maybe paraphrased just a little bit, but to assure that we have a regular and predictable issuance and cadence, people who are buying treasury bonds, whether it's US households or foreign central banks, we have to they have to be assured that we're serious about getting our debt and deficit numbers under control. I know you really care about this. Uh, I certainly do. I feel at times like the American people don't fully understand the impact of the debt uh on uh, you know, on their economic on economic activity today, but the threat going forward.

Well, we

So I'd love for you to expand on that a little, talk about why that's important and what steps, what are the steps that we could be taking in Congress to address uh the debt and the deficit numbers.

Well, sir Congressman, let's look at a little bit of history. And this is MIT's numbers, not my numbers. MIT believes that almost fifty percent of the inflation we saw during the Biden era was due to the size of the deficits. So, first of all, for the American people, not only does it affect the interest rates or ability to issue debt, it also affects inflation. When you have these roaring deficits, money goes into the economy, And what the Biden administration did was they injected, you had a demand shock through giveaways, but then you constricted supply the with the regulatory state, and that's how you get inflation. And this administration is doing the opposite. We had a fiscal cra- we had a fiscal contraction the f- for calendar year twenty twenty five. And as I said earlier, we are cutting regulations, so we are increasing supply. the we- whether it is energy for services. So that is why core inflation, the uh, is down more than half a percent since President Trump came in.

One of the things we're talking about, uh, in the budget committee, uh, cha- with Chairman Errington is a resolution, uh, that would set a goal for Congress to get to a three percent deficit to GDP by uh within the next uh decade. Uh, this has, uh, bipartisan support. We're hoping to see that support grow. You've talked about this. You've set a goal of wanting to be, uh, at a deficit percentage of GDP starting with three by the end of the administration. I wonder if you could talk about the importance of, uh, that goal as well in just a few seconds, I have remaining.

Uh, y- yes, sir. I, I came out from behind my very comfortable desk and am here today, because I was concerned about that trajectory. And I do believe it is um, it is possible to get back to the historical level, three percent uh deficit to GDP. And uh, while that is not a balanced budget, if you have nominal growth above that level, you are paying down debt.

Thank you. Thank you. Miss Chu.

Secretary Besson, since President Trump launched his illegal war in Iran, you've repeatedly assured Americans that higher prices would be temporary. In March, you said Americans should expect only fifty days of temporary elevator prices. Secretary Besson, it's been almost one hundred days and inflation is at a three-year high, with no indication of going down. In May, you said help is on the way when it comes to skyrocketing gas prices. A month later, Americans are still searching for the relief you promised as they pay more than double at the pump. than what they paid before the war started. Later that month, you described rising inflation as a very limited spike. In reality, for the first time in three years, inflation is outpacing Americans' wages and Americans' saving rate has dropped by half since last year. And just yesterday, before the Senate Finance Committee, you again characterized inflation as a short-term blip. Recently, President Trump proudly claimed that he doesn't think about Americans' financial situation when it comes to the war with Iran. So I want to ask you, Secretary Besant, do you agree with President Trump that you also do not care about Americans' financial situations?

Uh, Congresswoman, who was the president during World War One?

Can you

No, who who who who

Are y- are you refusing to answer my question?

No, I'm aski- who was the president?

I don't know, but clearly you're not answering my question.

So you don't know who the President during World War One was.

So

Well, let let me tell you

so I'm clearly getting the idea that you do not want to answer whether you agree with

Oh, I I'm I'm I'm happy,

President Trump that you do not care about American's financial situations.

I'm I'm I'm happy that President Trump does care about American's financial situation.

Well, he actually said that he doesn't.

The uh, no, that that is a truncated thing like everything is, uh, that he is future-proofing because I can tell you, American's financial situations would be the uh devastated if Iran got a nuclear weapon and there was a permanent, permanent shutdown of the flow of energy out of the Middle East.

Well then let me ask you, what's your prediction?

And and I and I and I promise and I promise you that President Woodrow

I take I'm taking my time back.

I will I will promise you that President Woodrow Wilson,

What's your prediction?

who was President during World War One, the the Germans did not attack us, that he got into that,

I

it was a war,

well you're not answering the question so let me ask this.

it was a war of principles, and I guarantee you President Wilson

What's your prediction that America

Woodrow Wilson thought the same thing Congresswoman.

only fifty days of temporary elevated prices wrong. You said that Americans would face only fifty days of temporary elevated prices.

OK.

Was that wrong,

Uh

since actually of course we're at a hundred days now?

the the the uh how much of gasoline prices come down from the peak? Seven percent. Crew prices are down more than twenty and gasoline prices follow crew prices.

Well then reclaiming my time

Those those those are inconvenient facts.

Reclaiming my time, gas prices are up by fifty percent since Trump war started, and up nearly thirty percent from last year. Diesel and jet fuel prices have risen even faster because refining markets are strained. Utility costs have soared due to higher natural gas and fuel input costs. And that means commutes, homey heating and electricity, airline tickets and delivery fees are all more expensive. And how about grocery prices? They jumped more in April than they did in nearly four years since when Biden was president. And then Beef is up by fifteen percent. Tomatoes are up by forty percent. Bread and milk are up eight percent and five percent compared to three months ago. And it's those lower income households that are hard to hit by Trumpflation. Well, it's it's it's co- co-sumers, They're forced to cut back on spending and str- Excuse me, when I I I know it's an inconvenient I know it's an inconvenient fact, it's my time, but but I know that it'd be hard for a billionaire like you to imagine how these lower income households would be hit by inflation.

But prices, food prices are up.

In fact, in fact, Trump said he couldn't care less about higher car prices for Americans. Do you agree with that statement?

Uh, I believe that food prices are up two point, food at home, two point five percent since President Trump took office. I know that's an inconvenient fact for you. You're from California. Maybe you care about avocado prices. Maybe you want them higher. But they're down nineteen percent.

Well, all you have to do is to go to the grocery store to see that beef is up by fifteen percent.

Uh, I, I go, I, I go to the grocery store and all you have to do is look at

Tomatoes are up by forty percent.

Yeah, you, you don't get to you,

And bread and milk are up by eight percent.

you, you, Congressman, you, you, you, you, you, you don't get to pick and choose. It is a basket and the basket is up two point five percent. During the Biden era, it was up five percent a year.

Well, you paint such a rosy picture.

Five five percent a year.

But I think Americans are not experiencing this rosy picture that you paint. They're asking, are my wages keeping up with costs? Can I afford the things that my family needs? And I'm afraid the answer is no.

Well, uh, I'm afraid you're incorrect because we had real wage increases every month since President Trump took office except for the month of April. So I know the facts don't align with your narrative. But please, you're entitled, you're entitled to your opinion.

Your your narrative is not lining up with what Americans are experiencing right now.

You you you you you're you're not you you're not entitled you're entitled to your opinion,

I'm sorry.

not your own facts.

I'm sorry.

It's dangerous.

I yield back.

Mr. Hearn.

Mr. Secretary, it's good to see you. Thanks for being here.

Great to be here.

And um I I can see you're you're talking a lot about the facts. The facts are is during the four years of Joe Biden we had a twenty-five percent increase in prices no way did the wages keep up during that time the highest gas prices we've seen in the last decade were under Joe Biden but uh my colleagues have gotten amnesia so but uh almost a year ago Mr. President uh Mr. Trump uh signed the working family tax cuts into law and preventing the largest tax increase in American history. I want to thank you, Mr. Secretary, for your hard work and for your partnership in getting that across the finish line. A huge part of the working family tax cuts was making permanent many provisions of the twenty seventeen TCJA, including eliminating the lockout effect, encouraging companies to bring intellectual property and profits back to the United States, lower rates for all Americans, the pass through small business deduction, and immediate expensing provisions, all of which have been proven to dr- drive tremendous growth in job creation. Prior to last year, the lack of permanency in these policies hindered economic But thanks to the working family tax cut, businesses now have the certainty they need to plan, grow, invest, and create jobs here in America. I know now want to shift focus to the expensing of factories, which is a new pro-growth tax policy in the working family tax cuts. After the passage of TCJA, bonus depreciation allowed businesses to deduct the full cost of equipment and machinery immediately. But the factory building that housed the machinery had to be depreciated over a much longer thirty-nine year period and the tax cuts were not enough. This created a major gap in US tax policy. Manufacturers could quickly recover the cost of machines, but the cost recovery for the enormous capital investments in the physical fa- factories lag far behind. Last year's tax law extended an accelerated expensing treatment to the structures of new domestic production facilities allowing manufacturers to quickly recover the cost of the building and in turn make it significantly more attractive for companies to invest in expanding US manufacturing capacity. And in fact they have. We see that, we hear about it, we read about it. Those are the facts. Following the passage of the working family tax cuts, fifty-two percent of manufacturers surveyed said they would intended to use the new provision to immediately expense the cost of the construction or expanding a manufacturing facility over the next four years. Mister Secretary, uh, my first question is last year I asked you about the importance of this provision, and you said that expensing for factories in a way puts us on a level playing field with countries that heavily subsidize our industries. And as you know, this provision expires at the end of twenty-nine. Do you believe this provision should be made permanent or extended to continue incentivizing the expansion of U. S. manufacturing capacity and job creation? And then also, in your response, could you also talk about what this does for your three three p- three plan and how that's part of the the integration of that?

I I I think we should extend or make it permanent. I I was able to go and visit Winnebago, uh, in Minnesota, and they told me that because of the expensing, they were on the fence on whether to do a battery project for their RVs in Florida, to build a factory. But because of the full expensing of equipment, full expensing of structures, uh, they were doing it. And I think we are seeing that again and again. But, Congressman, what is very important here, and I don't think people really understand, we are creating capacity here and productive capacity is what generates future tax revenues. So we they you get the immediate hit to taxes now, but then you create an accelerated stream of income that is much higher, a multiplier effect after that. I call it the slingshot effect. So for one or two years, I think we're gonna see this burst of factories and manufacturers that were encumbered the uh under the Biden administration and I think going forward we are going to see a breakout in corporate uh income tax receipts.

Mr. Secretary, I think what you're describing uh it shows the ignorance of the critics of this policy because it's very easy to shut down a building or a facility but much more difficult to re- build something and re- uh re- uh staff it to move kind of businesses back from abroad so I applaud you we're gonna build it, and they are going to come. And then one final uh question, I have significant concerns on third-party financing of litigation in the United States particularly regarding the tax treatment of these profits derived from it. And currently these financiers are claiming capital gains treatment and it is, and best, uh highly questionable that unadjudicated claims of harm of consti uh constitute capital assets this activity is distorting our judicial system and turning our court system into a casino. And I'll really love for your team uh at the IRS to work with me and look into how we have this tax treatment. Of this practice, there are many people across the nation are concerned about uh sovereign wealth funds and others that are gaming our system.

Uh, Congressman, I look forward to working with you on that, especially uh international and foreign money that is coming in and gumming up the works and sponsoring these lawsuits in our system.

And and paying no taxes.

So.

And and paying no taxes. So I look forward to working with you on this.

Thank you very much. I yield back.

Mrs. Miller.

Thank you, Mr. Chairman. Secretary Besant, thank you for being here today. I've found it a little disturbing, the animosity and lack of decorum from some of the members of this committee. Uh, common courtesy takes us a long, long way. I'm a life-long small businesswoman. And I want to emphasize the importance of working with business-minded leaders, rather than career politicians, who may not fully understand the real harm that bad policy inflicts on everyday Americans, especially back home in my state of West Virginia. The working families tax cuts provided much relief to our families, our farmers, and our small businesses across the country, and it fulfilled President Trump's promise of tax relief and certainty. One of my priorities has been saving the Gig Economy Taxpayer Act, which repealed the Biden administration's harmful ten ninety-nine K reporting threshold of six hundred dollars, and it restored back to the proven standard of twenty thousand dollars and two hundred transactions. Can you speak to how much of an effect that this policy had on the tax filings of our hard-working Americans?

That, uh, well, I d- I think that just speaks to the Democrats are not the party of Main Street. They're - they're the - I don't know what they're the party of, but they are br- bringing this down. I - I thought that it was one of the most reckless things that had been done, that you were gonna create this paperwork for small businesses, mi- many of them, they are service businesses, and you're to do this and the magnitude from twenty thousand to six thousand it just shows a complete tin ear but an administration that probably had a record low business people involved with the administration, and what, you know, they viewed the uh as business experience. Uh, so uh I I think uh realigning that for Main Street and small businesses was essential, and we we have seen no ef- no effect at the IRS in terms of the revenues from that.

That's right. If anything, it's better. In your testimony you mentioned President Trump's signature new tax cuts and specifically the no tax on overtime provision, which rewarded hourly workers by allowing them to deduct up to twelve thousand five hundred dollars or twenty-five thousand dollars for married couples this pro-growth policy has helped expand domestic manufacturing in our country and helped hourly workers keep more of what they earn have you seen that the no tax on overtime policy benefit our tax filers this past tax season.

Uh, the representative, uh, I was with President Trump on April fifteenth in Las Vegas, w- for a rally, uh, you know, for tax day for his signature policies, and he asked for a show of support from the crowd. And, you know, we were at the home of the service and the tips income. And actually the no tax and overtime got a bigger ovation than the no tax and tips. And it's it's the American way. We had the seventy-five percent of the filers make under hundred thousand dollars, ninety percent uh make under two hundred thousand, and the average deduction uh was thirty-one hundred dollars. And it's the American way. If you wanna work harder, you get to keep more the of your take-home pay. I was with a group of small business owners out in California near the Reagan Library. And they they love it. Uh, I I I was in a local Italian restaurant there. The owner loves it because he was having staffing problems. So now, you know, he has experienced staff. He's happy to pay the overtime, and the employees are happy to work the hours.

Very much so. Thank you so much. I yield back my time.

Thank you. Before I recognize the gentlelady from Alabama, I want to inform members that at the request of our witness, I intend to call a brief recess. um, following Miss Sewell's questions, and I now recognize the gentlelady, um, for five minutes.

Thank you, Mr. Chairman. Mr. Secretary, you promised, uh, the American people that the big, beautiful bill would lead to big economic boom for the American people. In a statement you made on July third, twenty twenty five, after the passage of the so-called " one big, beautiful bill", you said that the legislation would unleash growth in the American economy. Republicans pledged that it would stimulate economic growth and lead to an additional two point four trillion dollars in government revenue. However, the most recent GDP data shows that the economy barely grew in the last quarter of twenty twenty five, at a rate of only point five percent, and continues to fall uh below expectations in the first quarter of twenty twenty six. Time and time again, uh, You told the American people not to believe their own eyes or what's in their bank accounts. Uh, while families have been hit with higher costs from Trump's illegal tariffs and his uh costly war on uh a war of choice in Iran, this administration continues to insist that the economy is thriving. The reality, sir, especially for the folks that I represent in Alabama, is that you forecast a five point four percent growth in GDP for the fourth quarter, twenty twenty five, and only delivered a point five percent growth. The reality is that wages have fallen behind rising inflation and that job growth dramatically slowed down since uh Trump took office. Mister Secretary, I'm asking you uh I'm asking you rhetorically the following question. I ask you, why was your analysis so wrong? And I'm asking you rhetorically, since you've shown yourself not to be able to answer questions on this side. So let me try to answer it. Could it be that Trump's illegal tariff or the cost of, uh, the war of choice in Iran were the reasons why your analysis was off? Whatever the reason, I want you to know that the people that I represent in Alabama are hurting under this economy. Prices in Alabama have fallen by three point six percent over last year. Energy prices are up eighteen percent, and exports of Alabama products and services have dropped by three billion dollars since President Trump took office. In addition, the Iran war has cost American households over one hundred billion dollars. Grocery prices are rising faster than any times in the last t- four years, and gas is over four dollars a gallon in Alabama. where last year it was only three dollars a gallon. Mister Secretary, your economy, this economy, under this administration is failing the American people, and we can and must do better. My second question, or my second topic I'd like to discuss is what's going on, And and I I I will point out that I I I will I I will point out sir, I'm I haven't asked you one single question. Mister Chairman, that five five point four percent was a line of fed GDP now. I asked to reclaim my time, I'm not asking him a question, I'm stating facts.

Uh, you're not stating facts, you're stating opinions.

Mister uh Mister Secretary, black and brown Americans feel like they are under attack by this administration. President Trump has ordered state legislators across the country to redraw maps to dilute black political representation. Moreover, Trump has weaponized the DOJ to go after groups like the Southern Poverty Law Center because of the work that they have done to expose white supremacy groups, that are often supporters of President Trump. I am asking you, sir, that if the IRS plays a role in these cases, I ask that you ensure that the IRS is not improperly influenced by the president or this administration during the duration of that case, and I trust that you will make sure that that does happen. Lastly, uh, Representative Davis and I, uh, sent us several letters to the IRS and I think that Representative Davis during his questioning of you, asked you about it. This past uh uh this most recent tax season was the first time that the President signed an executive order in September of last year that ceased paper refund checks from being issued this decision to upend paper res- uh paper checks has led to a significant delay in refunds for those taxpayers and I understand in your response to Mister David's you said that ninety-five percent of those that receive their uh refunds get them electronically I think so. Well, I represent the five percent that do not have access to electronic repayment. Those folks need paper checks and they need their refunds now. I trust that this administration will do all that it can to make sure that all Americans irrespe- irrespective of whether they're unbanked or have access to electronic payment that they get their refunds and Mister Davis asked a question that you didn't answer but I'd like to answer it for you we're asking that you and your office that the Treasury Department work with us to make sure that our constituents get their refund checks.

I I will commit to do that.

Thank you, sir.

And and as I said,

I yield back the balance of my time.

that that was that was the first I've seen, and to be clear, that number five point four percent was the Atlanta Fed GDP now need now, but I know that's inconvenient. So.

Thank you, sir, for your time.

Thanks. Thanks. Um, as as announced, the committee will stand in a five minute brief recess.

Call the hearing back to order. I'd like to recognize Mister Gustav for five minutes.

Thank you, Mister Chairman, thank you, Mister Secretary, for appearing today. I I do want to thank you for your service and for your leadership in the working families tax cuts, the one big beautiful bill which I think is one of the most significant pieces of legislation that we've produced in this institution in a long, long time. If I could, and I I know that you've been asked earlier by uh Congressman Buchanan about section one ninety-nine A, but I wou would like if I could go a little bit further with you on that. Obviously, we made permanent in the one big beautiful bill of the Working Families Tax Cuts Act uh a provision that gave a twenty percent deduction for those small businesses. When we looked and were considering the policy, of course we had given a permanent deduction or a permanent deduction or rate for um those C corps, a twenty percent, twenty-one percent rate, but we were looking at parity as it relates to those small businesses. Uh First if I can, if I can ask you to give in your opinion the effect of the permanency for those small businesses and for the pass-throughs. And then secondly if I could ask your opinion about a bill that I've introduced, the Small Business Tax Cut Act, which would actually increase that deduction from twenty percent to twenty-three percent.

Uh, uh, Congressman? Uh. We are clearly the party of Main Street, and nothing is more Main Street than putting small businesses, they are on par with big business. And what we are seeing is the great certainty. For many people in small businesses, many of them mortgage their homes for these businesses. So it is the certainty that enables them to invest, to hire people, to plan for the future. And I think we are going to see that. The other thing that we are doing at Treasury, uh, is They are trying to unleash our small banks, because small and community banks are the lenders to these companies. So we believe that for many years, regulation was not tailored, and the small banks, uh, it was too big to fail, small banks became too small to succeed. So I think the combination of the certainty and the Main Street lending, we're really gonna see the flourishing.

Good. And would there be a benefit to small business to raising that deduction from twenty percent to twenty-three percent?

Uh, we're happy our opposite tax policy is happy to engage with you and your staff on that, sir.

Thank you very much. Uh, Mister Secretary, as it relates to uh rates and yields, think about the the bond market and um I was looking at some uh some quotes from uh uh the Clinton era, specifically um James James Carville, if I could, if I could quote him, this is him talking about uh the bond market. He said, "I used to think that if there was reincarnation, I wanted to come back as the president or the pope or a four hundred uh baseball hitter, but now I'd like to come back as the bond market, you can intimidate everybody." And then a second quote from President Clinton to your predecessor Secretary Rubin He said, you mean to tell me that the success of the economic program and my reelection hinges on the Federal Reserve and a bunch of blank bond traders. Eh eh eh eh eh, let me ask you if if I can for eh eh eh eh to give uh maybe some certainty or some clarity to those uh bond traders, those in the in the bond market and the relative state of our economy.

But our our s- the state of our Our economy is strong. We are having a short-term the level uh increase in price levels. We will get to the other side of those. And I I defy this side of the aisle to tell me what is wrong with our economy. We've had two point six percent GDP growth the per quarter since pres- average since President Trump came in and that's despite the democratic shutdown in the fourth quarter and this this conflict that we're going through so I'm very optimistic. The on the other side, and in my view, and we are going to push this, at - at - the - the US will be hosting the G-twenty this year and we have the leadership that the biggest threat to financial stability is a lack of growth. And I believe that we can grow well in excess of three percent, given the deregulation and great tax policies. So - and, Congressman, back to your initial question, it's all about certainty. So we have permanence. If you wanna come if you're an American or a foreigner, come to the US, build your business, you have tax certainty, you have energy certainty, you have regulatory certainty, and that all flows back into the treasury. And what comes into the treasury is stability. We had a fiscal contraction for twenty twenty five. And everything we are doing now is creating more productive capacity. It will be tax revenues down the road.

Thank you, Mr. Secretary. I'll yield back.

Thank you. Uh, now I'd like to recognize Representative Stubbe for five minutes.

Thank you, Mr. uh, Chairman. Mr. Secretary, thank you for being here. Families in Florida are still focused on affordability. Groceries, housing, cars, child care, and day-to-day bills. Treasury's new analysis shows the working family's tax cuts are delivering relief through policies like no tax on tips, no tax on overtime, the enhan- the enhanced senior deduction, which is huge in my district, and the expanded child tax credit. and no tax on car loan interest for American-made vehicles. Beyond the top-line numbers, what tangible steps is Treasury taking to make sure these policies translate into more take-home pay lower tax bills and real breathing room for working families seniors and small businesses? Your mike.

Uh, representative, what we did was, uh, we had about ninety-eight percent last year of on-line filers And we made sure that they got their refunds the within twenty-one days. So, uh, the other thing I've encouraged people, one of the reasons for big refunds is you haven't changed your withholding. So, they had, if filers change their withholding, they get an automatic step-up the in their monthly take-home. And, you know, we we are constantly, uh, refining all of these programs at Treasury. And, you know, I we're trying to educate people because Um, I I've been in restaurants and, you know, when I talked to the servers, said how is no tax and tips going for you, and they said, we didn't know about it. So I think a lot of it is education, and I would expect that the take-up this coming year will be even bigger.

So I represent one of the most elderly districts in the nation. I have the most social security, uh, recipients of any district in the country. Uh, so what should seniors on fixed income, uh, feel from this law over the next year? the the rebate that we did is just i've had people at events come up to me and say how impactful that that's been to their bottom dollar

well as you may have heard me say earlier a few weeks ago i was at the villages with with the president and you know obviously very warm welcome the average deduction was seventy five hundred dollars sixty eight percent of the filers make less than a hundred thousand ninety four percent make less than two hundred thousand this is very important for people you know on a fixed Fix budget.

Uh, Representative Panetta and I introduced the Taxpayer Protection and Prepare Perficiency Act to crack down on fraudulent and incompetent tax preparers, including ghost preparers who prepare returns for a fee but refuse to sign the return, or include a valid PTIN. For a taxpayer who did everything they thought was right, it can be devastating to later find out that their preparer inflated deductions, claimed credits that they did not qualify for, or disappeared after the filing. From Treasury's perspective, how serious and pervasive is the

So, uh, we we are working on that, uh, with with the constituents and this this is a real problem, if that especially as you described for our seniors, more than one one third of our seniors have been victim of some kind of a fraud, and what we don't need i- is some kind of a a tax fraud here. So we are, you know, we have pushed out to the preparers to make sure that everyone, uh, understands what should be done. And we are happy to work with your office, you know, on that, especially for seniors who are subject to fraud.

For many working families, a tax refund isn't just a number on a return. It's money for rent, car repairs, groceries, medical bills, or paying down debt. At the same time, Treasury has to prevent improper payments and fraud. How is Tre- how is the Treasury utilizing modernization efforts to get refunds out quickly while balancing the need to protect taxpayers and the Treasury from fraud?

Well, last last year approximately ninety-eight percent of taxpayers filed an electronic r- return and uh we were able to if everything was in good order, we were able to get that return uh sent electronically within twenty-one days. The o- the other thing we are doing that is ver- very important we we now have the means to say we don't think your return is correct and this will likely trigger an audit, do you wanna do you wanna have another shot at this? And that is very helpful in terms of you know down the road in terms of the number of audit cases and for taxpayers who they or their preparer made a may have made an honest mistake.

In the twenty seconds I have left, is there anything that you haven't had an opportunity to address from the lies from the Democrat side that you'd like to address in this time?

Uh, again, the we we've got a temporary the inflation uh spike, uh groceries, the uh as the Democrats or many people like to say, it's up two point five percent since the President came to office. We work on this ev- every day. Uh, the underlying economy is very strong, the jobs numbers, they are good, uh construction jobs are up. And what I wanna say, Congressman, is These are private sector jobs, private sector jobs, we could have started any government program and, you know, put a million more jobs on the board, but it's private sector jobs that enables Americans to have real wage increases, and every month except for A- April, Americans saw real wage increases.

That's a great point. Thanks for being here.

Thank you, Joe.

Thanks for all your good work.

Almost time has expired, uh, recognize Miss Moore for five minutes.

Thank you so much, Mr. Chairman, and thank you, Mr. Secretary, for appearing. And thank you for your patience and indulgence, uh, for this very long hearing. Um, I just, uh, don't wanna get into a big fight with you, sir. But I, um, uh, I I would have to agree with one of my colleagues that spoke earlier. Uh, this is, these are some Dickensian times. uh and for some people that these are these are the best of times uh and we have heard you reiterate over again about how strong the economy is how uh this inflation is very short term how job growth uh to you looks promising good thing the jobs report comes out tomorrow instead of today

oh i i would the representative i wish it would come out today cause

i ok

i i i don't have any prior knowledge so i don't wanna move the market

ok ok Okay, so, um, I I guess, you know, when when, uh, our colleagues like to attribute the president's confidence that he shouldn't worry about the financial stability or the financial ability of Americans, uh, and your notion is just sort of a little blip, this inflation, that people should not be taken seriously, I guess we would have to say that you agree with the president that uh that our economy is strong and that we shouldn't just shouldn't worry about people's situations.

Uh

Is that the conclusion I can reach?

Uh, no, my conclusion is that we the uh understand that things are challenging now because of this conflict and we will get to the other side of this, but the underlying economy is quite resilient.

OK, well good. Well, we've heard this before. Um, and it's the worst of times, cuz I mean seventy-six percent of Americans are perceiving are feeling the forty percent increase in utility costs. You mentioned groceries, uh, and I guess that's a it just depends on what kind of basket of food you choose. You better not choose something like beef or something if you're getting a, you know, some of the ramen noodles or something, I guess that won't affect you as much. Well, we think we I think I think we got change. But these are the worst of times for a lot of people, excuse me. And what we have found, and I'd like to place in the record, an article I found without objection, which really indicates, and maybe it's no fault of this president, but in fact wages are growing at a much slower rate than inflation. And if we look at data going back to even, you know, the beginning of this century, we'll see that um that inflation is really eaten up about all of the economic benefit people have and people are experiencing that. When your utility bill goes up forty percent, um we've already paid, what is it, forty eight, just since this war, this blip, people have paid forty three billion dollars more in gasoline costs. Um and um uh and people are are feeling some pressure from that. I I wanna just change the subject, Mister Secretary, and talk a little bit about the um tax credit uh for the um the private school fund uh and this is a bill where um this is a program where a taxpayer can get a one hundred percent tax credit for providing monies to the what do you call these organizations the school granting organizations. Um, can you, what what other tax credit do we have where people don't have any skin in the game, they get a a one hundred percent tax credit for their participation? I just want to be reminded of it, cuz I don't know.

Uh, again, I don't I don't know why you think there's no skin in the game, because this can go to students in public schools for tutoring. It can go to handicapped students.

Well, it, you know, I guess kids in public school don't pay tuition. And so I I don't know how

But if if you wanted to hire a tutor for your child, you could do that.

But I guess I'm talking about the taxpayer, sir.

If you had a s

So I'm talking about me as a taxpayer, if I want to provide money to a school and say it's a school and let me get to the point. What if I wanna donate my money to a school that doesn't follow any of the civil rights protections? You know, you know, I don't wanna admit LGBTQ. students, I don't want to admit uh black students or um what what would and I get I'm gonna get a dollar for dollar tax credit for that, what other tax credit program do we have that's similar to that?

Uh almost nothing.

Nothing. And

And many of these are for religious schools, ma'am.

Exactly. And so it this is sort of an inequity we're building into the system. My time has expired, but I just want the record to reflect that this is an inequity, uh, where we're giving we're allowing we're we're circumventing the state's rights.

General Omsid's expired.

Well, will you indulge me?

I I I couldn't disagree more.

The j-

Yeah. Okay, I have a unanimous consent request, um, to put these materials in the record, Mister Chairman.

Wi- without objection, I'd now like to recognize Mister Fitzpatrick for five minutes.

Thank you, Secretary Besson, for being here today. We appreciate it. Um, sir, since uh the beginning of um Russia's war with Ukraine, um many of us have worked to make it unmistakably clear um that Russia's illegal campaign of aggression will not be normalized nor rewarded. And that is why several of us have continued to advocate for sanctions that will put um economic pressure on Russia and ensure that any peace agreement uh is durable, is real, and is uh agreed to by the government of Ukraine. Uh last year um a a large bipartisan group introduced something called the Peace Through Strength Against Russia Act, a comprehensive legislation that mandates sanctions on Russian officials and entities supporting Russia's uh defense energy and transportation sectors. Uh this bill will close loopholes um fueling Russia's war economy, uh targeting uh Russia's energy leverage and impose sanctions for war crimes, including the kidnapping and wrongful deportation of Ukrainian children. It establishes a five hundred percent tariff uh on all imports from Russia to the United States as well as on products from any nation which continues to enable this war through the purchase of Russian origin oil and natural gas. Um this committee uh and this congress uh I believe have an obligation to provide the administration with the tools necessary to deliver lasting peace through strength. Um on May eighteenth um the treasury announced a further thirty day extension of sanctions uh waivers uh permitting the purchase of Russian uh seaborne oil uh citing the need to support uh energy vulnerable countries affected by the supply chain disruptions in the Gulf Mor- uh Gulf Oil markets. Um and while uh it was intended to address energy shortages, the waiver has the potential uh to enable continued Russian oil experts that generate revenue uh for the Kremlin revenue that could be used to sustain uh Russia's ongoing war effort. So um Mister Secretary again thank you for being here today. Just uh on that point um what safeguards are in place to prevent the Kremlin from using um this extension to fund its war against Ukraine? Can you expand on the um the rationale for this waiver uh and potential for there to be financial benefit to Russia in this war effort? And then lastly, uh, is the Department of the Treasury prepared to implement, um, meaningful sanctions against Russia such as those described in the legislation I just referenced?

Hmm. Uh, maybe.

You have to step back and think. Are you willing to put a five hundred percent tariff on China? Cuz all all all I all I've heard, especially from the other side, but many on our side, were how tariffs are inflationary. I don't believe they are, but a five hundred percent tariff is an embargo. So, um, I am the highest ranking US official in this administration who have visited Ukraine, so do not mistake my skepticism for this for a lack of support for the Ukraine. And let's go back and look at the sanctions regime. The Biden administration was weak, weak and weaker on Russia's sanctions. There were exemptions. If I were to score zero to ten, the sanctions level was three percent. And then, probably the worst National Security Advisor in history, Jake Sullivan, on his way out the door, for, in January of twenty twenty five, raised what I would call the sanctions level from a three to a six. So the Trump administration could adhere to those sanctions, and we have. In October of twenty twenty five, President Trump asked me the how could he really turn the heat up on Russian Federation, and I said you could do what no one else is do done, sanction Luke oil and Rosneft, and that has been done. So make no mistake, Congressman, that this administration has been tougher than any country in the world on the Russian Federation. And the Europeans, I believe that they are on their twentieth sanctions package now, which they're very proud of, but I believe that means their other nineteen have failed.

Um, so just to follow up, Mr. Secretary, um, do you believe that the, and this is an open-ended question, um, that's why we're having this conversation, do you believe that the current sanctions structure is sufficient? Do you think any changes need to be made to that? Um, and if you could address the issue of the waiver as well.

Uh, well, wi- with the waiver, the wa- waiver's done two things. It has kept overall global energy prices lower. And, you know, the other thing it has done, during World Bank IMF week, uh, many of the most vulnerable countries asked me, uh, to continue the waiver. I had not intended to. Uh, and we have. My guess is, or my strong inclination is, that if there are further waivers that they will be

Gentleman's time has expired. I'd like to recognize Miss Tenney for five minutes.

Over here. Thank you so much, uh, Secretary Veston, for being here and on the, while we're on the energy topic, I do come from New York where we band natural gas drilling, and we're talking about affordability. Uh, we still haven't hit the peak, uh, gasoline prices in my state that we've had under the Biden administration. And, uh, we weren't, uh, dealing with the conflict in the Middle East. Uh, we didn't deal with the democratic shutdown of, uh, of our Department of Homeland Security last fall. We also, uh, didn't kill the Keystone pipeline, banned all new oil and gas leases, and also restrict leasing on thirteen, uh, million acres of land in Alaska. And the Biden administration was only able to bring prices down by releasing fifty million gallons in November of twenty twenty one another hundred and eighty million gallons uh a million per day in March of twenty twenty two and that was the only reason our gas prices came down so as a as a New Yorker who's very sensitive about uh energy prices and really bad energy policy that's driving up the costs in our state and you can look I think if you looked at some of the stats you've put out if you just took out New York and California for example the the prices would probably be substantially lower on average and and uh And actually your numbers would look even better. So I just want to say thank you for recognizing some of those things that I think my colleagues on the other side haven't seen. But I do want to give you,

And and and and and Congresswoman, I you know,

if you

I would say that n- no one likes pa- paying higher electricity prices, but that is a state issue. And it is a really a red state, blue state issue, because blue states have not been built new capacity and red states have. So it is a regulatory morass that we see unfortunately. The uh and great states like New York and what the people are subjected to.

Absolutely, and it's a transmission issue and a pipeline issue and an access issue and an, you know, lack of uh common sense, but let's talk about the positive things because uh we wanna talk about the HR one and h- and your help in getting that across across the finish line. Obviously it was a monumental piece of legislation building on twenty seventeen tax cuts that I actually was in Congress for and voted for, and and we are grateful to you and your your department for making that happen. I also wanna make sure and recognize, you talked about some permanency today, and I wanna make sure that we recognize one of the signer signature pieces of legislation that I I co-authored actually with my colleague uh Representative Sewell. Uh and it's the uh making the New Market's tax credit permanent as part of H R one, and that was something we fought hard for and it was very bipartisan. And my district alone in upstate New York, which is way up in the rural areas, uh New York twenty-four stretches from the St. Lawrence Seaway all the way to the Niagara River. Uh, the New Markets uh credit has delivered over thirty-eight million in total project financing supported by over three hundred and fifty full-time jobs, and has brought real investment to uh communities in in thi- in our region that Washington al- often forgets, and we appreciate you for that. Um, and the permanency also, it really helps our rural communities, especially low-income neighborhoods and o- oddly enough, very similar communities that uh Missoula has in Alabama. So we want to thank you for that. Uh, and also wanna just thank President Trump, the infrastructure's been been significant. You talked about permanency and why that's gonna be good for our communities. I do wanna ask you a little bit, and we could just get into when it comes to the implementation of new markets, um, the community development finance, uh, you know, program and that fund. Can you just give us an update on that and where we are gonna be with that in the future?

In in terms of the CDI?

Uh, CDI, yeah, where we are with CDFI and how and and that looks like we're moving st-

Yep. So the OMB apportioned the the funding for fiscal year twenty twenty-five and we had to restore accountability. Uh, you know, over the last year my team has reviewed rhetoric priorities and we fi- we are getting CDFIs back to their core business. It's not gonna be financial engineering, it's not gonna be wasting uh, taxpayer dollars, and um, we we think that they are important when used properly. Like one of the biggest financial frauds of last year, a trickle, or was the CDFI.

So, uh, w- are we gonna see when when are we gonna see a timeline on that for our applicants? We know that w- do we have a that is that coming out of Treasury?

The I'll I'll have my staff get back to yours tomorrow.

OK, that'd be great. We appreciate it. Hope you run for president. Thank you.

Thank you. Now recognize Mister Boyle for five minutes.

Thank you. Um, Mister Secretary, a few days ago the White House Director of National Economic Council, Kevin Hassett, said, uh, and I quote, "people are spending more on gas, but they're also spending more on everything else, not just groceries, but restaurants and so on." I think that's a sign you see when people are optimistic about the future. I I was wondering if you agree with your White House colleague that people spending more on everything else is just a sign of great optimism.

Uh, I I think high discretionary spending is prob- likely, yeah, what Director Haass had meant, and I

You consider gross spending on groceries discretionary?

Yeah, I again

Or gas discretionary?

I I didn't say gas. Did he say gas?

Uh, yes, that's correct.

Right.

I'll read the quote again. "People are spending more on gas, but they're also spending more on everything else, not just groceries, restaurants, and so on. That's optimism.

Yeah, yeah. So the " everything else" would be discretionary spending, Congressman.

Well, um,

It would, it would be

well, well, I'll tell you what. I have,

I- I- I- I- I will tell you, I will tell you, if

we can settle, uh, no, excuse me, reclaim my time, I can settle how the American people are feeling about this economy because I have the data on it right here from Fox News just the other week on the President and this Administration's handling of the economy Seventy-one percent of the American people disapprove, including forty percent of Republicans. On the President's handling of inflation, seventy-two percent disapprove. They disapprove, in fact, by a three to one margin over approval. So, do you agree with the American people or are they just wrong?

Uh, look, the the American people were torched. Under the Biden administration.

Oh my good- I wish I had a dollar for every time you or on someone on the Republican side brought up Biden's name if I did I might have as much money as you have,

Wait, wait, wait, you, you, you Others might,

Mister Secretary.

you would have lost twenty-two percent of your por- purchasing power because that's what happened.

So the American people are wrong.

That's not what happened.

The fact that by a three to one margin they disapprove

Well

of this president and your performance on the economy.

Well, well, the, the, the,

They're wrong.

the Democratic House has a seventeen percent approval rating.

No, I understand why you don't want to answer the question. Are they right or wrong?

Are they right or wrong? And, and, well, the reason

So let me, oh, I forgot to ment- reclaim my time. I forgot to

There are so

Consumer sentiment is at an all-time low. So the numbers on the approval rating of this president on the economy are the lowest since the Great Recession but in terms of consumer sentiment which actually does measure whether or not people are optimistic about their future, the lowest in the history of a poll that dates back to nineteen fifty-two.

Mm.

Well, let's look at the underlying data. Two thirds of those are Democrats. The Democrats, the

Not two thirds, excuse me, two thirds of those polls, so Fox News, the Economist,

No, no,

All the polls are wrong.

no, no, you're you're citing the University of Michigan and democra-

There have been other surveys as well,

the the Democrats who who listen to this kind of twaddle,

but the Michigan survey

they uh vote i- in the single digits, teens, whatever, Republicans, they uh vote much higher, and that's how you get it,

I I I don't even know what you're saying,

that's how you get a call this number.

Mr. Secretary.

No, I don't think you know what you're saying. I know what I'm saying.

I'm citing the facts. Those are the facts that you have a problem with,

And Yeah,

Mr. Secretary.

I I I I'm I'm citing I'm citing data.

Well, let me, let me just turn, since I only have two minutes left, let me just turn to this. I- I think it's unquestioned fact that in the twenty twenty-four election, President Trump, in my home state, the Commonwealth of Pennsylvania, and throughout the country, especially those seven big battleground states, he promised the American people, and I quote, "I will lower costs on day one." Well, Mister Secretary, as it turns out, today is exactly day five hundred of this administration, and costs aren't any lower. They are higher than ever before. Inflation is rising. Gas prices are surging. Consumer confidence again has collapsed. And health care costs are going up thanks to the bill that you helped pass over a year ago. Why won't you just admit that this has been a failed presidency? Because the first step to turning this around would be emitting the problem.

The two point six percent GDP growth, exceptional job growth in the pri- The, that's the average since President Trump came into office. Real wage increases every month except for April. So if you think, if if if

Once again, inflation is eating away at the,

But, but again, I, I'm not

uh, pocketbooks of the American people.

I,

I can tell you this,

I, I, I'm not, I'm not gonna discuss firefighting with an arsonist.

in the thirty sec- reclaiming my time, in the thirty seconds I have left,

I'm an arsonist like everybody over there.

when I was back home in Northeast Philly a couple days ago, and at a gas station, people were paying over four fifty a gallon. They were feeling a lot of things, a lot of emotions. I guarantee you optimism wasn't one of them. With that, I yield back.

Thank you very much.

Thank you. Thank you, and I'll recognize Mister Murphy for five minutes.

You know, memory is a wonderful thing to study, how we reme- Yeah. So it's it's really it's it's hilarious, I think, actually sad and pathetic on another hand, um, that people don't remember. You know, I'm sorry that people get triggered when they talk about the former president. Um, but twenty-one percent cumulative inflation during four years, which I think maybe you c- you you're you're smarter than I am in this regard, contributes a lot to what's going on. Now, that said, I think it's actually pathetic that this si- the other side of this, uh, dais places more concern about talking about gas prices. They didn't talk about gas prices during the last administration when they were higher actually than they were now, but they placed more concern about that the fact that their children and grandchildren might get irradiated by a nuclear weapon one day. No, we're actually finally doing something about that.

I I couldn't agree more, Congress, as someone with children who hopes to have grandchildren one day, President Trump is future-proofing the this Iranian regime against h- having a nuclear weapon. And the short-term challenges that we are seeing now, it would be nothing compared to that.

Yeah. And you know, I I I totally commiserate with those, especially lower lower income individuals where it's harder right now. Absolutely. Understand. But if we d- if we look back on one of the great historical lessons of Britain, during the Battle of Britain, and the things that they took on to save the fact that they uh, they didn't wanna be destroyed by Nazi Germany, the same thing that we don't wanna be destroyed by a radical Islamic regime, which is in their constitution to do so, then hardships sometimes are challenging.

Well, I - I - I think the best analogy here is World War One, that Germany hadn't declared war on the US, we just knew that it was a menace, that it was a, that it was a cancer that had to be stopped. And we have cut the head the uh off the snake. Everyone should remember the number of Americans who have died at the hands of the Iranians since nineteen

Yes.

seventy nine they are the world's leading sponsor of state terrorism. Whether it's the USS Cole, through their proxies, whether it was the the barracks in Beirut, And on and on.

And yeah, we had a vote yesterday, basically that was applauded, not so much maybe it was anti-Trump, cuz everything's anti-Trump these days, but it was more pro-Iranian in so many different regards. Nothing against the Iranian people, but the Islamic regime wants to kill Americans, and has done so, as you point out, since nineteen seventy-nine. Let me, let me just pivot just a little bit question here, cuz I would love to have your thought about this. I hear time and time and time again from the other side that the that the rich are not paying their fair share. Can you tell me Did the uh working family's tax cuts, was it something just for the rich?

Uh, under TCJA, that the the highest income brackets paid ten percent higher. And you know, I I can see that for, especially for the President's signature policy, ninety-nine percent of the filers on no tax and tips make less than two hundred percent, ma- make less than two hundred thousand dollars, no tax and overtime, ninety per cent, six percent of the filers. Seventy-five percent make the less than a hundred.

So I I've asked them

And if we we heard w- the, you know, the the rich don't get tips. The rich, the uh, don't need the senior deduction.

Yeah, I saw I've just asked them repeatedly, repeatedly, tell me what that percentage is. What is the fair share? The fact that the top one percent donate one third of all the donations in this country. Yeah, maybe they should do more. I don't have any no issue with that, but that's a voluntary thing. And you've read the book Atlas Shrugged, right?

Yes, sir.

Don't you think we're seeing a lot of lessons from that today?

Uh, I I think we're seeing more lessons from nineteen eighty four.

Oh, yes indeed, indeed. Let me let me uh pivot just a little bit to a to a challenging topic, and and that's our debt. And the fact that I think we've had pro-growth policies put forth in our tax bill, which may not be readily apparent right now, right? So I wonder if you could just give me uh what you think is gonna what our projections are gonna be. Jet ad debt to D GDP, what's gonna happen in the next five to ten years with all the investment that's gonna be coming in?

Well, uh, as I said earlier, Congressman, that we are creating high highly productive assets that will be generating the high returns that will then go into the tax base.

Yep.

Uh, this manufacturing renaissance that we're seeing, uh, creates jobs in two ways. The companies will be paying more taxes, they avail themselves as we wanted them to of the hundred percent full expensing on equipment for f- for equipment for factories for foreign structures, and that will go into the tax base. I call it the slingshot effect.

Right.

Pull it back and then it starts paying off.

Yeah, it's like a slinky. Um, you know, i- if, God forbid, there was a a Democrat that got into the next White House, they're gonna come in and claim all the wonderful benefits that we're gonna see at that point in time. Just kind of like the Biden administration talked about all the job creation after they destroyed all the jobs,

Good. Thank you. Thank you, sir. Thank you, Miss Fischbach.

Thank you, Mister Chair, and and Secretary, I wanna say thank you for being here, um because it's always good to see you and I genuinely appreciate the information that you have and the, and when we have the opportunity to have the discussion and be able to ask questions, But I really am sorry that the other side chooses not to acknowledge any of the good that's come out of this bill and and that's simply because this committee, the Republicans, Chairman Smith and President Trump are the ones that did it. So they refuse to see any of the good and and I'm sorry about that because I I think that they're missing a lot. Um uh

Look I I I'd be worried because the uh you know all all these tax returns that we got that had one of

And, and I feel like they did it simply because President Trump supported it.

Simply because.

And so they, yep, absolutely, and I, and I do feel sorry, uh, and I am sorry about the fact that they believe that being rude is the way to have any kind of discussion and that the only thing that they're seeking is is uh social media clicks and so I apologize for that because I I not only um your position but also the information you're able to provide and I think it's important that we have civil discussions as opposed to this uh kind of yelling at people and not letting them speak so I apologize for that um but I I just wanted to uh ask a little bit my uh my district is very rural very family oriented and um and so I I wanted you to maybe talk a little bit how um particularly those families that benefit from what we've done in the bill, you know, the pro-family divis- uh provisions and maybe a little bit about that so that people can understand better what we really did for those families.

Well, that we Well, first of all, permanence is very important. We increased the child tax credit from two thousand to twenty-two hundred. That that is, uh, permanent. And, uh, we we've done And that per child, forty million, forty million families, yeah, have claimed this benefit. And uh with with everything here, you know, as someone the, you know, who's studied the history of economics, we would have had a cataclysmic event if we'd had a five trillion dollar tax hike.

A- absolutely, absolutely. And I think, I think it's incredibly important, like I said, to not only, to all of the families. And and I, like I said, represent a rural area with lots of families and and so I think it's incredibly important that we do provide those kinds of tax breaks for those folks. And what would have happened had we not been able to do that is an incredible, is an incredible story.

Great.

And and and I think we have a barbell here, the representative, that we have on one side it's the expensing of of business equipment, can be farm equipment, we have ag structures, and then on the other side the president's four signature policies.

And and you you you uh anticipated I think some of the where I was gonna go with the ag, but I also did want to with a with a little bit of time I've got left, is talk a little bit about the small businesses, cuz our communities depend so much on those small business, and I think that uh one ninety nine A has been has been uh discussed earlier, but I think that uh if you have anything else to say on how just critical this these tax cuts are to those small businesses, because I will tell you those those small businesses are absolutely the the backbone of my district and so if there's anything else you wanna add on that.

Well a representative of Wall Street Journal accused me of being a populist, the uh firebrand because I said it's time for Main Street to do well, which I pointed out to them that's why it's called the Wall Street Journal not the Main Street Journal. And this is a Main Street administration, I came from a small town and Wall Street always does well and everything with one ninety nine, they uh make sure that main street small businesses as i said earlier many people put their life savings into these businesses and they are the backbone of many of our communities we've tried to make sure that they have proper lending but importantly when you're gonna take on that kind of financial risk for yourself your family you want to have certainty i think we've given them great certainty and i think permanence i i think permanence in these tax cuts we'll never have to call them tax cuts again because they are permanent

mmm Well, and and with my remaining couple of seconds, I know that you were invited to Pennsylvania, but I'd like to invite you to Minnesota anytime and and so that you would get outside of the metro area and into um into the rural areas where these tax, permanent uh these these tax cut permanent tax cuts have really, really had an effect. So I thank you for being here and, Mr. Chair, I yield back.

Thank you. Um, Mister Secretary, there's no need to read that paper anyhow. Um. I would just point that out. Mister Buyer.

Thank you, Mister Chairman and Ranking Member. Uh, Mister Secretary, thanks for being here. And I, I have no intention of, uh, trying to find something for social media. Um, I share your concern I'd love to see faster economic growth in America. Three percent would be amazing. It would help us begin to unwind the huge deficit that we have right now. Uh, what I am much more concerned about is not all the individual statistics. You know, the My my college statistics textbook was lies, damn lies, and statistics. We can all pick out the ones that we like and the ones we don't like. I'm much more concerned about it on a on a more macro level, that on at least five s things like like you, I've studied economic history a great deal, that the administration is moving in ways that seem contrary to everything that I've learned about economic growth. Number one, of course, is the tariffs. Um, tariffs have rarely been a good And we've seen study after study that's shown that ninety-six percent of the tariff revenue so far has been paid for by American consumers and American businesses. Uh, well, also has that led to a reshoring of manufacturing. Second is workforce. We know the two drivers of economic growth are workforce participation in the product and technology productivity improvements. With the immigration enforcement, no one here objects to deporting criminals, um, but we've gone and we've imprisoned or deported Hundreds of thousands of hard-working people paying American taxes with American families, that have now, according to the businesses I talk to, the builders can't build, the farmers can't farm, our our our fast food places are all done, all those workers um that necessary are are gone. Number three, the the war of choice. You know, it has an acute capitalist regime change. It didn't bring democracy to our our Iran. Um, they still have the missile capabilities which we are seeing every day, and they still have the nuclear stuff. And I see a Trump administration scrambling to recreate the joint comprehensive plan of action that he walked away from, that actually had nuclear weapons twenty years away in Iran, and it will be lucky if we can get back to that again. And then there's the dis- the disinvestment in research. You know, twenty percent cuts to almost all university research. National Science Foundation down fifty-five percent. The science department said no, and EPA eliminate it. It cuts to NIH and CDC. And what we're seeing is the young scientists in America fleeing to Germany and to France and to England places that they want them. You know, this is back to where does our growth come from? And then I think maybe the most damning thing, half of the growth last year, which by the way, according to the Federal Reserve is two point one percent, not two point six. It was one point six percent according to the Federal Reserve in the first quarter of this year. Tho- those are not any further like the two point eight that we had in twenty twenty four. But the half of the GDP growth last year, that two point one percent, came from data centers alone. OK, there are eight hundred thirty-one data centers right now under construction. Um, you know, I live in an area that has half, two thirds, three quarters of the data centers in America. Um, you know, I, I am a big AI optimist, but I, I promise you, so many of the people that I talk to are, are hating the data centers because of the impact on water, the sound, the particulate matter, the electricity costs. And ultimately, the the fears about what all that AI may do to their privacy and their concern. So, you know, I I I want you to be successful because I'm an American and I love my country, and I want to have three percent growth. I just worry that so many of those decisions that you have made, the president made, are moving us in the wrong direction. And with that, rather than getting into an argument about you, I I I know your um your responses. Let me move to something that I think is has not been touched upon today,

Is is that as in saying in a courtroom, ask and answer?

that the president Oh yeah, maybe.

Yep.

The President announced that he was a a appointing, he had plenty of chance today, uh that he uh appointed a businessman and current head of the Federal Housing Financing Authority, with zero background in intelligence gathering and national security, to be the acting DNI. Of course, uh I speak for many of us who think that Mister Polte is wildly unqualified for this job, and also has misused his limited authority as head of the Federal Housing Finance Association to manufacture bogus mortgage fraud cases against the president's enemies. But I know that you've had some interaction with him before. I think you said at the finance committee yesterday that you told him you were gonna kick his rear end. But rather than going through an intensive search and vetting prop process, um, we look at you who had to go through all that, who had to be vetted, voted in by the by the US Senate. Doesn't it bother you as a Senate-confirmed, deeply vetted cabinet official, that you're gonna be asked to serve with a character like Bill Polity?

Uh, I I think the president has chosen a great cabinet. I think he continues to. And I think that it's a false assumption. When you look at highly cr- credentialized people, if I look, no one had more credentials than Jake Sullivan. And as I just said, I think he was the worst national security advisor of all time. He over s- Do you think the Afghan pullout was done in a good way? Thirteen peop- It was tragic. Thirteen people died at the Kabul airport.

W- w- w- w-

He wrote a piece in Foreign Affairs magazine. that the uh had to be redone online. I've still got the hard copy where he said everything's fine in the Middle East. And then we got October seventh. So I don't believe in credentials. I've actually made a lot of my money over the years betting against the status quo. And I think President Trump, you wouldn't have thought that a real estate developer could come down an escalator and become president twice. It had never been done before.

I always point out that the Afghan withdrawal was done on Trump's timeline after it was negotiated at Camp David with Mike Pompeo.

All right, Mister Moore.

Thank you, Chairman. This is a very important hearing, and particularly Mister Secretary, for being here. I wanna commend the work that you and your staff have done to, over the last eleven months, to implement the working families tax cuts. As a father of four and a representative from the youngest state in the country, I'm proud of the fact that we focus so much on supporting families and the next generation through an increased child tax credit. refundability of the adoption tax credit, and of course, the creation of Trump accounts. Mister Secretary, Treasury has initiated that over f- that ha- has indicated that over five point five million Trump accounts have been opened. Five point five million. With eighty-six percent of them linked to families making less than two hundred thousand dollars. Can you speak to what this investment in lower and middle income Americans and children will do for their future?

Uh, good. Uh, Congressman Moore, thank you for your leadership on this. I think that this is one of the most important benefits for young people, maybe since the GI Bill. Thirty-eight percent of American households have no exposure to our great financial markets. They believe that they are on the outside looking in. I grew up in a rural place in South Carolina. I only knew that something bad had happened on Wall Street, nineteen twenty nine. And I have pushed and pushed for financial literacy. And I think this is gonna do two things. We're creating a generation of shareholders that when the, uh, program goes live, and we're at six million as of this morning, uh, when we go live, uh, July fourth is a Saturday, we'll go live on July sixth, that all those families will be able to look at the app and know that they have a share. The, uh, in in our great economy, in our great markets, and we have created at treasury, we've created learning modules, trumpaccounts.gov. And I think this is going to be the ultimate, uh, learning experience and, you know, on the the back end of this, that when the children turn eighteen, they can take it out, they can use it to for down payment on a home, they can use it for education. They can roll it into a retirement account that they take out when they're sixty-five. So, I think that this, the uh, as a supplement to our current programs is going to prove one of the most durable legacies.

You c- you make a point that not enough people had access to it, and I think you and I and many others understand that there was an opportunity to have access and it doesn't it in a it only requires a little to make a huge impact in your own life but getting started is insurmountable to a lot of people. They think, " Oh, this isn't for us, this isn't for me." And what this does is it makes it so it is literally in front of every single an opportunity for every single child in America, to be able to have it there and have a part of it. Um, the other aspect of it that I that I think is is do some of the most what I think's been most incredible part that's come in the aftermath of passing it is I don't recall seeing really in my t- maybe you got better examples, but over six billion dollars given to one specific initiative of philanthropic dollars from the Dell family and so many others that are involved can you help put this into perspective um how significant and wide-ranging private and philanthropic investment is into Trump accounts?

So, the a lot of excellent points there, uh, Congressman, uh, first, uh, there's this idea of food deserts, that people weren't able to get or still aren't maybe able to get nutritious food because they're in a food desert. There have been financial service deserts, that people they don't have the minimums to open some kind of a non-bank account where they can get access. So, I think that this is curing that. This is a free, low-cost, no-cost, entry. Uh, if your child's born during President Trump's term, you get a thousand dollars. But as you highlight, I think that this is a change in philanthropy. Foundations, great philanthropists like Michael and Susan Dell can donate directly to the children of America no big foundation buildings no annual gala they uh, no no speakers straight to the children of America. And what Susan and Michael have done that they are giving to uh the they have excluded the top twenty percent of zip codes in America, they're gonna give to every eligible child the in in those zip codes it will be two hundred and fifty dollars per account. That that's what that's six point two five billion and we have more and more philanthropists who are coming on on board all over the country, we have major corporations that are doing it uh for their employees People can adopt school districts, they can adopt zip codes, they can adopt states. Uh, I think we're gonna see foundations and many state governments are getting on board. So we have created the delivery device and the hold the holding tank for this, and I think it's going to explode.

It's galvanized so much more than I think people even expected it, the group that's been involved with this to invest America from the start, getting it to where we are. It's been an absolute honor to be able to work with the team on this and look forward to some of the best opportunities. Like I said, I have four young boys under thirteen years old. I was at their age when I learned the concept of a checkbook. They're gonna be able to learn the concept of of compound interest and how just a little bit now is gonna affect them later and I yield back. Thank you.

Miss Beth Van Duin.

Thank you very much, Mister Chairman, thank you, Secretary, uh, for joining us today. I think it's safe to say that you have probably worked as hard as anyone over the last eighteen months, and no one has done more for the American

Uh, well, we in- we inherited a mess. We had had the - the worst inflation in - in forty-nine years, and I think in many ways the worst for working people in our nation's history, because the, you know, someone was asking me about the inflation indices earlier, that, you know, that's the average for working families that it i- it is thought that many, many of their goods and services inflated as much as thirty-five percent with an eighteen percent, uh, wage gain. So the loss in purchasing power was tremendous. We were running the biggest deficit to GDP that would ever run, six point seven, six point nine percent, when we were not at war, not in a recession. And we had to get that under control. And then, you know, everything that was happening to our American workers uh you know from the the border being open and you know whether it was safety the uh or um jobs being taken

so since january of last year what would you say that the largest economic indicators um have been showing the greatest improvement

uh i i would say that every month except this past april we have seen seen real wage increases we have seen on average two point six percent gdp growth for the past four quarters And, uh, the underlying resilience of the economy, we paid the, we pulled down the fiscal deficit to GDP. Uh, we got it down to about five point five percent. So we had a fiscal contraction and still grew. And, uh, representative, everything that we, all the jobs we created, they're in the private sector and they're for Americans.

I appreciate you saying that, because the previous administration often pointed to job growth as evidence of, in fact, of economic success, but much of that growth, as you just mentioned, came from the government hiring. So can you explain the difference between the in an economy that is driven by government job creation versus that in the private sector?

Well, the you we see the productivity go up, but more importantly for the people who are getting those jobs, that ver- very difficult to create real wage increases. Uh, traditionally government jobs are indexed to the CPI, so you're you're just keeping up. that the with private sector, you're peop- people can move up. And we are creating with the Tax Cuts and Jobs Act, we're having the uh, a building boom in manufacturing structures, and that if someone's the kind of finan economically illiterate said to me, well, where where where are all these manufacturing jobs? Well, manufacturing jobs take time. I was up in my hometown of Charleston, South Carolina, Boeing is expanding their facility there by fifty percent. It's the Dreamliner production facility. So first you get construction jobs, then you get a thousand high-paying jobs in the Boeing factory. And we're seeing that again and again.

Well, I think the public, uh, the goal of public policy shouldn't be to make government dependency more comfortable, right? But it should be to make economic independence more attainable. And so, um, would you agree that the most effective way to improve a family's financial situation is not through government assistance but through higher wages? And better job opportunities?

A a hundred percent, and the uh and the opportunity to start your own business. And that's what we're seeing too, that in terms of Main Street coming back, the one one of the things, you know, I spent my career in the financial sector and forty-five percent of our small and community banks disappeared since the great financial crisis. Senator Warren likes to say, " Ooh, we might have a bank failure." She killed forty-five percent of the small banks.

Yeah. I think, you know, the the Trump administration is rightly

I'm I I I I I'm not even sure what I'm doing.

Let me let me tell you, for the fifth uh consecutive year, uh I am hosting what has become the the nation's largest job fair. Last year we had over five hundred businesses, uh, uh, that represented over thirty-three thousand jobs, and we had about thirty-five thousand people, came last year to Globe Life Field and we're gonna do it again this year, August sixth. And we would love to have you there. I am formally inviting you right now to attend. Because if you wanna know about economic policy, don't ask anybody in Washington. Ask the single mom who now has a job that pays the bills. Ask a vet who now finds a new career. Ask a worker who can get off economic, government, federal assistance because he's got a job that has given him a new opportunity. These are the real scorecards that I think that we should be looking at.

Well, uh, I was just in Texas a few weeks ago, I'm gonna be there next week, and that, that, that is the land of opportunity.

I appreciate you saying that. I think the clearest measure of a successful domestic policy is whether Americans believe opportunity exists. And I think on August sixth, over thirty-five thousand people are gonna walk in the Globe Life field. Looking for gover- not for government assistance, but looking for jobs. There are over five hundred businesses will be there because they need workers. And to me, that's the strongest real-world indicator that President Trump's economic agenda is working. And with that, I yield back.

Thank you.

Thank you, Mister Evans.

Thank you, Mister Chairman. Thank you for being here, Mister Secretary. The Trump- Biden administration

Trump?

b- administration is failing at home and aboard. It is not a smart investment for the future and certainly isn't delivering on the affordability agenda that American people deserve. The president's policy has left Americans paying more in food and gas and health care and electricity. The electricity price is especially important to me because it's related to the growing concern around the cost of data centers and future investment in energy. Meanwhile, the Trump administration has said he does not care about the financial situation of Americans. He has called the gas price peanuts. While the GOP focuses on policies that make m- money for Trump, and its allies, working families are paying the price. So I say to you, Mister Secretary, obviously there's concerns that we all have about what is occurring. Though I know you may have a different view, I wanna share with you the view that I'm having and living with and hearing my constituents talk about. So as a result, I yield back the balance of my time and thank the Chairman and the Ranking Member for this opportunity of this hearing. Again, I thank you.

Good. Thank you, Congressman. Yeah, exactly right.

Thank you, Mister.

Thank you.

You yield that to me. Thank you, uh, Chairman and Ranking Member. Thank you for holding this hearing. Secretary Besant, I truly enjoy always talking with you. Um, I was a Professor of Business and Economics and, uh, I've, uh, when I got my doctorate I actually, uh, did some some work uh on on what you've done in the past so uh I'm always very impressed. I wanted to say um we've done some historic things over the last year obviously the the big beautiful bill the working families tax cuts acts is is just incredible. Can you talk a little bit about that bill I I'm going off script a little bit so I hope I I I'm OK. But um can you talk about international tax and what that is going to do to bring in onshore businesses and and keep keep the U. S. competitive around the world. Uh, we have so many multinationals and other other companies, um, that that do jobs around the world, and I see a lot of this employment coming back and a lot of the the workforce that that we're gonna have in in the U. S. is gonna grow. Can you talk a little bit about that?

Yeah, so couple couple of things, and I enjoyed our trip out to Iowa, I I remember

Fantastic.

being there when everyone says like that the uh gasoline prices aren't gonna come down i remember the level when we went to the the the diner with the chef and they they will come down

that's right well uh you know what and they're all happy you know compared to what everybody else is saying all the farmers are happy

right but um so corporations have a choice globally and

yep

i think with this administration i have often described that we have a three-legged stool And it is tax, trade Yep, excuse me, tax, trade and regulatory certainty.

Yep.

And all of those have worked to push the businesses back into the US to make them wanna come here. And it's certainty. Come here, you have tax certainty, you have regulatory certainty, and you have energy certainty. US is an energy superpower.

Yes.

And w- w- I I am responsible for the the US economic dialogue, China, and when I look at like what does China envy the US over, it's our military, it is our economic system and the strength of the dollar, it is our innovation, and it is our energy, and we can't take those for granted,

Sure.

and all of that centers around the tax policy and this immediate expensing, uh, it's my belief that in China they spend about four per four percent of GDP,

Yes. Yep.

they're subsidizing industry,

That's right.

so we aren't command and control economy, what we tell people, uh I I don't go through the S and P five hundred and say, you need a loading dock, you you need a new assembly line, we just give companies a hundred percent expensing and they can do what is best for them.

Yep. And that it's capitalism, I mean it wor- it works well, and like you said, we're not giving anything like China is. I mean it's just phenomenal, it's just immediate expensing and that's just a timing issue. Um, I just wanna talk about uh, I was really in involved in the ACRE Act. Uh, this is, uh, borrowing, uh, farmers that borrow costs for manufacturers and agricultural businesses, uh, stuff like this. Uh, could you highlight how this will help strengthen America's agricultural economy? Um, if you know a little bit about it or not, uh, what it is, uh, it's a, it's the, the, the tax on the loans and, uh, we have lowered that. We wanna continue to lower that. And, can you just tell how that could incentivize growth in rural America?

Well, I, I, I think that that deferral on the tax is very important. because there there is nothing with more fixed assets.

Yeah.

The uh, uh, farming is an interesting business, my my family's been in the farming business for two hundred and fifty years, that it's an interesting business because you have high fixed, the uh, income assets, or high fixed assets, but you have uncertainty, the uh, ba- based on weather, production, so,

That's right.

uh, you know, ver- ver- very, the uh, there is a lot of uncertainty And this brings much more certainty in terms of cash flow to those farms.

Yes. Yes, absolutely. Then one final thing, based on farming and stuff like that, uh, I call it the pilfer tax, it's actually government sticking their hand in the grave and, and, and ringing some the, a death, dead person's neck and saying, you owe us forty percent in death tax. Uh, I'm always appalled by this when somebody passes away and all of a sudden we say, oh, by the way, you owe us forty percent tax if you pass that land on or that manufacturing or or that small business on to the next generation. Uh, so we did fifteen million, uh, uh, thank you to President Trump and, and everyone else to get that done. Would you, what, what is your thoughts on trying to permanently get rid of the death tax? I mean, do you tend to agree it's sort of a pilfer tax?

Well, uh, it's, all that capital has already been taxed at least once, many times, twice. And, uh, to, to go back to, uh, foreign land, in, in many, I've studied tax policy around the world, in many countries, including the UK, uh farmland is not subject to death theories.

That's right. That's right. Thank you so much. Always good to see you. Thank you. I yield back, uh oh oh, Mister Chair.

Thank you. The Chair recognizes the gentleman from New York, Miss Malia Takas.

Uh thank you very much uh Secretary Besson, thank you very much. Thank you. Welcome to our committee. Chair Rickon, you're next. It is great to have you here. Uh first I wanna say uh thank you for your words in support of suspending the federal gas Uh, I have legislation that would do that. It would suspend it for ninety days, give the president additional authority for a hundred and twenty-five days. Um, I'm introducing that with my colleague, Max Miller, on this committee as well, and um, we hope that we can get that through. Um, number two, I wanted to say that, you know, in pointing out some of uh what my colleagues on the other side have been saying about the working families' tax cuts, the fact remains that this was a historic tax cut for working Americans for middle class families, for senior citizens, they are the ones who voted to cut the standard deduction in half, to cut the child tax credit in half, to increase tax rates for Americans across the board, and they also voted against tax cuts for tipped workers, for those who work double shifts in overtime, for uh refunding taxes paid on social security, to our senior citizens. And so first, uh, you know, the SALT deduction and the senior citizens, I believe, uh, in addition to the child tax credit, which we've seen tens of millions of families take advantage of across the country, um, I think the SALT and the, uh, senior deduction were most beneficial. I was very proud to have authored the, uh, bonus senior deduction, uh, and I think essentially it has given back the seniors that qualify the taxes that they paid on social security and they're seeing that money returned to them which is why it is no tax on social security provision. Could you talk a little bit about SALT and senior deduction, how that benefited preferably New York but the entire country?

Well, I I I think in high tax jurisdictions, you know, high income, high tax like yours, uh bringing back some level of the SALT deduction, it was appropriate. I think that no one negotiated harder, well maybe a couple people, but it it was a group effort from uh some of the Northeast and California delegations, and I think we got to a very good spot on that, uh, SALT, that if if this tax bill had expired, uh, the SALT deduction would have come back, but so would the AMT, which would have devastated the, uh, which would have devastated e- e- everyone in in those states.

The middle class.

So, and, look, as as I travel around, that whether it is the social security deduction, when when I look at these numbers, So ninety-nine percent of the filers claiming the no tax and tips, incomes under two hundred thousand dollars, ninety percent under a hundred. For the senior deductions, ninety-four percent under two hundred. The sixty-eight percent under a hundred. So these are people they are on fixed incomes and they need certainty.

Yeah, and the SALT deduction, again, was not for uh billionaires, it was targeted to families of incomes of less than five hundred thousand dollars.

Yeah. I I think it was very well

It it certainly was, and I know that

Or, excuse me, tailored and tapered.

And and and I I I could tell you that in my district, we have many people have saved thousands of dollars because of that salt deduction, and seniors who have saved thousands of dollars because of the other deduction as well. Um, and I just wanna turn to some of these organizations that we've been talking about. Our committee has investigated um, these organizations that have we're seeing a lot of foreign influence. Uh, we continue to see examples of foreign actors exploiting exploiting non-profit organizations to interfere in our political process, to fuel anti-semitism, in some cases even support or promote uh terrorism. We have also seen an increase in these organizations coordinating with and receiving support uh from individuals connected to the Chinese Communist Party. Uh one of these organizations is Code Pink, which Department of Treasury, your department, as well as Justice have launched an investigation into. I mean the Code Pink founders and groups there, they've meet been meeting with Cuba's communist regime, the Iranian regime, in the past they've met with leadership of Hamas. Uh, I would like to have an update on your investigation and do you see the potential for some of these organizations to have their five O one C three status stripped?

Uh, so I I'm gonna have to say to this side of the room now, I can't comment on ongoing investigations, but they they are fulsome.

OK. Well, we appreciate your efforts and uh I yield back my time and thank you for coming here and thank you for putting up with some of the nonsense that we're hearing.

Thank you. The chair now recognizes the gentleman from Carmel Valley, Mister Panetta.

Thank you, uh, Mister Chair, I appreciate that. Secretary Bessette, thanks for being here, and I, I guess you go by Doctor Bessette, based on that, uh, South Carolina degree that was conferred on you.

Hey, on- on- the, uh, only for the working press.

Understood. Look, as you heard, I come from, I hail from Carmel Valley, the place I grew up, place my Italian immigrant grandfather settled, thank God. Uh, we have a lot of beauty, we got a lot of bounty. uh, but unfortunately that means a lot of people wanna live there, so housing affordability does remain a major challenge in my district. And one of the reasons people aren't selling their homes is because they're gonna take a huge hit on taxes as I'm sure you're aware of, based on um the fact that there is a capital gains exclusion, but that's from nineteen ninety seven. And it remains capped at the fact that it's only two hundred fifty thousand for individuals, five hundred thousand for couples, and ca- and it has not kept up with inflation. As a result, many people who have grown out of their home just aren't selling because they want to protect their nest egg. Now, I got a simple bipartisan bill that actually has eighteen members of the Ways and Means Republicans on my bill. In fact, except the chair at this point, but I'm trying to get him as well. Um, that being said, the president has actually supported this idea as well. Um, and so not just because the president supported this type of legislation, for doubling those numbers making it two fifty to five hundred and five hundred to one million and then tagging it to inflation would you support that type of solution

uh

when it comes to dealing with our affordability crisis when affordable housing crisis

yeah i i i haven't seen studies that would show that how many openings that would create but i'd be happy to work with you on it i i remember it was it's a clinton era program

yeah

and i remember when the the when the when the clinton's changed it previously

exactly

you would were allowed a one-time deduction over some age, sixty, sixty-five,

Yeah.

or one-time tax-free sale. The uh you could you could roll your appreciation up to that sale.

Exactly.

So I think there are a lot of things that we can look at. I I don't want it to seem uh I'm older than you are, and I'm constantly told the the boomers get too much. I don't want it to seem like something that w- it's a giveaway to uh the boomers.

I completely understood, and look forward to talking to you and continuing negotiations on this, but I appreciate your uh acceptance of being open to the concept. So I appreciate that and look forward to working with you. But look, I think as you know and as you've heard, it's not just housing that makes it tough when it comes to affordability. Uh, over the last year inflation has rose three three point eight percent, energy has rose seventeen point nine percent, gasoline prices have rose twenty eight point four percent, food has rose by three point two percent, and core of core inflation is still elevated at two point eight percent and Look, I I know you got some good numbers. I understand that. But the fact is is that when you speak to people on the ground, um, including the polling that Mister Boyle referred to, uh, prices are a major financial concern. Now, um, the costs have been exacerbated clearly by the Iran war, but also tariffs, two areas I just want to hit on quickly. I realize you said the war is temporarily paused. I think you said that or you said that at the press conference you had last week. And, um, you said that once it's resolved and there is a deal gas prices will drop. Got it. But the president recently said that the Strait of Hormuz will be closed through Labor Day. Is that your definition of temporary, and are gas prices gonna remain high through the summer?

Yeah, I I didn't see that from the president, and every indication I have is that they should be open sooner.

OK. Uh, I I

And and we we've already seen,

Let, look, let

uh, oil prices are down more than twenty percent.

Understood, Mister Secretary, and I and I don't like saying this, but reclaiming my time. Um, uh, tariffs are also affecting these prices. And many people in small business in my district tell me that it's not just tariffs, but the constant change in the tariff policy that we've seen over the last year. Just yesterday the administration announced another change in tariff policy and another tariff regime. Fourteen countries subject to ten percent, fifty-six countries subject to twelve point five percent tariffs. Has Treasury done any sort of assessment on the impact of these frequent changes to the tariff policy and what they're having on small businesses? And is there an exclusion process planned to help these small businesses, because of these types of changes in tariff policy?

Well, I I I would have to dispute that the um, the cost increases were due to tariff policy because last year the inflation was in services and we don't tariff services.

Got it. But have you done any sort of assessment as to whether or not

So

you can help small businesses get through these types of tariffs?

Well, I think we've already done a lot with small businesses i in the working families' tax cut.

Alright. So, a- and in in in Okay. Alright, so so you have it. Uh, that's fine. in in in in in in in in terms of in Uh, what I'm getting, I'm gonna reclaim my time, just because you're not getting to the point. in terms of the refunds, Um, just let let me I'm reclaiming my time, uh, that's a s- that's a CBP issue. Mister Secretary. I'd thank you, but please know I think that should be done in regards to our small businesses. Now, also in regards to Mister Polte. Um, I'm an intelligent, I was an intelligence officer. I served in Afghanistan, uh, and I served proudly. And I dealt with the intelligence community. I know what you say about not having experience in the job, but please know that that's offensive. to people in the intelligence community, and worse, it's dangerous to our national security to have someone like that at that position. Thank you, Mr. Secretary, for being here. I yield back.

Thank you, Congressman.

Thank you, the gentleman from Buckeye State, Mister Kerry.

I want to thank the chair, I want to thank the uh ranking member, but also, Mr. Secretary, it's great to see you again. Thank you for being with us. Um, and again I I want to touch upon a lot of the a lot of the facets with the with the working families' tax cuts. um, and - and how it has affected the average American. But, uh, first I - I - I do wanna say I wanna - quite frankly, I just wanna kinda highlight some of the successes within the piece of this monumental piece of legislation. You know, this landmark legislation was drafted with every - with every American in mind. Didn't rego- it wa- it didn't matter their - their race, their gender, their income level, their marital status. This affected all Americans. the overall share of taxes paid by the top one p- by the top one percent, m- a- end of day, this is a fact, this isn't disputed, it went up. Well, a family with two children saw their tax returns increase by an average of eleven percent. That's a fact. For our small businesses. Think about our small business, the backbone of the American economy. We permanently extended. Mr. Secretary, that's big. That's big. For our seniors. And coming off of the social security fairness that we did in the pre-administration, but but for our firefighters and our our our our our postal workers and our and i- and our police officers, but but just what we did within the social security space, a six thousand dollar tax deduction, which is greater than the social security taxes the average senior household currently pays. For our manufacturers who built this country, we implemented one hundred percent immediate expensing for equipment and machinery. That's what we did. Now, there's been a lot of talk about energy. There's been a lot of talk about fuel prices for our country. And I - I want to just highlight a couple numbers because we've heard a lot of numbers and energy happens to be something I do know a little bit about. But today the average gallon of gas is four twenty-four per gallon. Into the previous administration, same time, average price was five dollars and sixteen cents, eh without the sort of Damocles of a nuclear warhead in Iran. You have to understand history to understand how terrible that regime and the threat that that would have been for all Americans. But let's talk about the pro-family policies that this monumental piece of legislation did. It permanently extended tw- two thousand two hundred dollar tax credit and tied it to inflation. That's every working family that has kids, folks. Every working family. Extended the adoption tax credit. Expanded education savings accounts to include additional K through twelve additional expenses. expanded the health savings accounts. Great things. Improved employer-provided child care tax credits. And made permanent paid family leave and medical leave tax credit. Our children will recap the benefits of the Trump accounts, in which five million, five million children have already been enrolled. Now this legislation Didn't pick winners and losers. It didn't prioritize certain segments of the American population over the others. And it's not a government handout to any particular economic sector. This is sound tax policy, focused on the tax certainty for all American businesses, putting more money in the pockets of hardworking Americans, and putting our country on a trajectory for economic success. Uh, Mister Secretary, I I know that you've had to listen to a lot of things today. And we do appreciate your service. We do appreciate you leaving the private sector to do something that in many ways is a very difficult position to be in. But Mister Secretary, your time, your staff's commitment, and this commitment of the administration to make America a better place, we appreciate that. So with that, Thank you again for being here today. And with that, Mr. Chairman, I yield back.

Good.

Gentlemen Yelts.

Thank you, Congressman. Thank you.

Also from the Buckeye State, Mr. Miller is recognized.

Thank you, Mr. Chairman. Mr. Secretary, it's great to see you again.

Good to see you.

Uh, and to note, Chairman, just a better part of the Buckeye State, uh, for the record. But thank you, Mr. Chairman, thank you to Secretary Besson for your testimony before this committee today. It is much appreciated. Since we last discussed digital assets in this room, the landscape has shifted from a conversation about the rise of these technologies to a question of how we successfully integrate them into our regulatory tax infrastructure. We have seen meaningful progress. The Senate Banking Committee has advanced the Clarity Act to build a market structure framework. Additionally, I, along with my colleague to my left over here, Rep Horsford, have introduced the Digital Asset Parity Act to finally provide the common sense tax certainty our businesses and investors truly require throughout our country. We are no longer debating whether digital assets are here to stay any longer, but rather how we define the rules of the road, and we believe that this is necessary now at this time in our history. I truly look forward to discussing how Treasury can collaborate with Congress to ensure these dual frameworks provide the economic stability and tax fairness the American people deserve. Mr. Secretary, the Parity Act was introduced to solve the phantom income in tax as cash hurdles that currently plague American businesses and everyday investors. We've seen that without tax parity, companies are hesitant to adopt these tools, and individuals are burdened by the reporting requirements that feel more like friction tax than truly a fair system. So, I'll just get right to it, as the Treasury Department looks at the current tax code, how do you see the parity act, specifically its provisions for stable coin payments and the elective deferral of staking in mining rewards as a catalyst for keeping digital asset innovation within the United States, rather than forcing it offshore.

So, Congressman, thank you for those questions. Uh, this administration and Treasury's goal is to onshore, uh, digital assets both because the innovation that we're seeing and U. S. standards and practices. So, uh, we would like to work with both of both of you on this to the perfect the the right balance between how this should be done but i do think look when whenever we get to the these new technologies there is an adjustment period we have to think about them in a different way and i believe not only for the technology for the payment rails it's essential for us to be the leader uh to maintain dollar dominance and we want to have the best standards in the us that we can export to the rest of the world so We'd be happy to work with you on that.

Thank you very much. And we've been working extremely hard over the last, let's say, fifteen to sixteen months to bring a framework and truly what we're seeking here really is, you know, besides the name of the legislation, clarity and parity and just stability for the tax code for these individuals. And I very much thank you for your answer and you're willing to work with both of us on committee and all of us. Um, our our bill also

And and Congressman, I would say let's get clarity done by the fourth of July, and then we can move on to the ho- how to check.

Mister Secretary, I would love that. I just If you could help me with some of those individuals up there.

I I I've been on the phone with them this week.

All right, well, if that thing gets moving, then yes, it makes our job much easier and I would prefer that way as well. Uh, but thank you and any more guided push would be awesome, uh, on our committee, I'm very grateful. Uh, a critical piece of this legislation is the application of section ten fifty eight, like treatment to digital asset lending. If the treasury department were to formally recognize digital asset lending as analogous to the securities lending covered under section ten fifty eight, What is your assessment of the impact on the domestic market liquidity? And specifically, does Treasury agree that extending this established tax treatment of non-recognition is one of the most efi- efficient levers to move digital assets from a speculative asset class to a functional, transparent part of our institutional financial infrastructure?

Uh, Congressman, you you o- obviously feel strongly about this. I have a motto in life, " No data, no opinion." But I will get back to you with an opinion.

I very much appreciate that. uh this has been one of the tougher subject matters that we've discussed on the committee because i believe that this country for a long time has been stuck in the analog era, and we are now in the digital age. And you know this framework altogether just provides guidelines and stability for the cryptocurrency network within our country. And I appreciate you know you saying you'll work with us, but I truly believe now is the right time for this with President Trump and the Federal Crypto Reserve and him wanting you know the United States to be the

Good. Thank you.

Gentlemen Yields, the chair now recognizes the gentleman from Vegas, Mister Horsford.

Thank you to the chairman and to the ranking member, Thank you to the chairman and to the ranking member, and I look forward to working And I look forward to working with Congressman Miller and the other members of the Committee on the Parity Act, which is a true bipartisan bill. Uh, before I begin, though, I want to thank Chairman Smith, uh, for his commitment to working with me also on the Full House Act. Uh, prior, uh, to the Senate-passed bill, gaming patrons could deduct a hundred percent of their gambling losses. They were taxed on what they actually earned, nothing more, nothing less. The Senate changed that. This provision was included without meaningful debate and creates a fundamentally unfair outcome for taxpayers who participate in legal gaming activities. Under the new provision, patrons can deduct only ninety percent of their losses. That means someone who breaks even or even loses money overall could still face a federal tax bill. So, Mister Secretary, uh, will you work with Chairman Smith and and me to fix this issue and to protect gaming jobs and tourism dependent economies like Nevada.

We'd be glad to, sir.

Thank you. Now you, Mister Secretary, you talked a lot about permanency uh throughout today's hearing. Uh for the tip worker, for the warehouse worker, for the teacher, for the nurse, and for the small business owners in Nevada, uh they don't need a temporary tax gimmick gimmick. They need permanently lower cost and permanently higher take-home pay. Yet when Republicans wrote their bill, they made a choice, uh, that the tax cuts for billionaires and large corporations would be made permanent, while making the tax relief for working people temporary. To me and to the workers, that tells them exactly who they were thinking about when they wrote it. That's why I have introduce the taps and uh tips improvement act as well as the overtime for all workers act because i believe workers who earn tips or who work overtime should really receive permanent tax relief not temporary if republicans are serious about helping working families they should join me in making tax relief for workers permanent just like they did for billionaires Now, Mister Secretary, I wanna uh discuss tariffs, which are hidden taxes that American consumers pay, including businesses. The Supreme Court ruled that this administration's broad tariff policy was unlawful. But American families already paid the price. Small businesses paid it through higher costs. Consumers paid it through hidden higher prices. And according to the Yale Budget Lab, the average household paid roughly eighteen hundred dollars more because of these tariffs. So at a time when you talk about giving relief to workers, temporary relief, on the other hand, they are feeling the effect of higher prices. So let me ask you directly, do Americans deserve refunds for money collected through tariffs that the Supreme Court ruled illegal? Yes or no?

Uh, Conger Congressman, uh, the American people had the money. It was in the US Treasury. and it's been taken away

do you do you agree that they deserve the money back that the supreme court ruled is illegal,

well

yes or no it's

eh eh it's not an yes or no question because every democratic attorney general applied to

the supreme court ruled that they were illegal Mister Secretary Mike

eh eh eh I know and but they applied for them to go back to the companies

ok

to to the to the to the

so do the companies deserve the money back

to the payers of record

so do they deserve their money back

that that is a issue for the customs and border patrol

No, no, no, no, no, no, no. Mr. Secretary, Then again, again, we while the Homeland Security Act of twenty uh two thousand and two may have transferred a number of custom functions from Treasury to DHS, Treasury retains oversight over trade policy and the protection of revenue functions. Treasury can delegate those functions, I but it cannot delegate that statutory authority. But, you know Just last week uh the Justice Department appealed a court order that would have accelerated refunds to importers and to businesses. Mister Chairman, I ask unanimous consent to submit for the record the May twenty-ninth article, US to appeal judge's order for broad refund of Trump tariffs.

Without objection.

Thank you. Secretary Besson, yes or no? Did you participate in discussions about appealing efforts to speed up tariff refunds?

No.

Treasury helps shape major fiscal policy. Returning roughly a hundred and sixty-five billion dollars to businesses and consumers is a major fiscal decision. So why wasn't the treasury involved?

Uh, uh, again, we act as the payment agent. Your bank does not tell you which bills to pay. You tell your bank which bills to take.

Well, from the public's perspective, taxpayers' perspective, the administration is fighting harder to keep their money than to return it. That's why I've introduced the Relief Act, What what what did they did they did? to give automatic refunds within ninety days to the people who paid the tariffs, and that once the refunds are made, that the benefit goes to the consumers that ultimately paid the price in higher cost. The Relief Act creates an automatic refund process, something that this administration has not been working to accomplish, and this would actually address the economic uncertainty that has been caused by these across the board tariffs. Not strategic, not in the best interest of American consumers, and it's time that we give the money back to the people who paid it. With that, I yield back.

And and many foreign companies and the uh I think we're gonna see that the payers of record many of them are overseas entities, so I I think you you you you wanna give them the money back.

Well, Mister Secretary, families in America don't experience the economy through GDP reports or stock market. indexes. They they experience it through rent and groceries. They experience it through utility bills.

I'm and what what does that have to do with tariffs?

Because they're pay that's exactly exactly right.

What do what

What does it have to do? It has to do with the average family not being able to meet their monthly

What what what what what what rent is

All right, time has expired.

budget obligations because this administration is so aloof to the reality

Mr. Gorsfer, time has expired.

that the majority of Americans are facing.

Mr. Bean.

Thank you very much, Mister Chairman, uh good afternoon to you, good afternoon. Ways and Means. Good afternoon, uh, Mr. Secretary. Welcome back to, uh, Ways and Means. Uh, four hours ago is when this hearing started. But a year ago, we were in the middle of debate of the one big, beautiful bill. You, Chairman Smith, uh, this president, were all architects. You made some big, bold predictions. Pass this bill, Congress, and, uh, we will see a reverse of manufacturing jobs, closing or fleeing the country. Uh, you made a big, bold statement. that you'll put more money in Americans' uh pockets than ever before. Should we pass this bill? We passed the bill and Mister Secretary, everything you said is coming true. How about that? There's more money in Americans' pockets. The four point five million manufacturing jobs that we've lost since the year two thousand, they're are coming back. And uh, from me speaking across Northeast Florida, people are excited, business owners are excited in in making that happen. A year ago also we were doing something else. We were debating Fraud, waste, and abuse. You would think that would unite this committee, uh, but you can see today we disagree on so many things. That's something that should unite us. I wanna brag on something that you're doing, uh, in Treasury Department. You're a core pillar of President Trump's anti-fraud task force. Your, uh, subcommittees and your, your initiatives of the Office of Terrorism and Financial Intelligence, FinCEN, and the Office of Payment Integrity are leading the way of supplying that task force, Let's Fight Fraud, once and for Something else you're doing. A year ago we talked about it, uh, of how fast we pay. Uh, the United States pays our bills very fast, sometimes too quickly because we pay people who shouldn't get paid. Uh, scammers, uh, don't have to rob banks anymore. They can just bill the United States. We'll, we'll, we pay them and then this pay and chase, we, we figure it out. So you and I, do you know this? You and I and your team have created a, uh, a bill to codify what you're doing now, which

Uh, Congressman, you are exactly right. Congressman, you are exactly right, The once money goes out the door, that once money goes out the door, that anything other than a partial recovery is unlikely. that anything other than a part of recovery is unlikely. Uh, I I was out in Minneapolis and saw what was going on there. And I think in terms of the US is a high trust society, and in terms of the maintaining the trust that American citizens

Yep.

or that we have in each other and and our visitors, um, it's important to prosecute and of course,

Uh

uh, prosecute, but the recoveries are gonna be very small.

I'm, it's almost a p- they're bad guys. They're uh, they hide and uh, Chase, with your efforts, don't give up on our bill that's in Mister Komer's committee. I'm still lobbying it. Uh, you weighing in would be a big deal. You're already doing it, but we wanna codify it. It's the best practice of paying our bills. Uh, scammers also are targeting older folks and Americans. They're s- they're these scam calls, spam and scam calls. I get eight to ten a day. Now the FTC, it's already against the law. We put your number on the do not call list. I wanna plant a seed with you. Uh, the FTC, FTC is responsible for it, it's against the law, but what if they don't have the teeth? or muscle that uh that Treasury has. I wanna plant the seed with you. What do you think about the idea of Treasury getting involved and chasing and and kicking out these scammers that are calling us?

Well, well

What do you think? Uh, Mister Secretary?

We we are a congressman. Uh, FinCEN is actively involved, and many of these come from overseas.

Right, and you've got the uh tools to go after them.

So So we we've worked very well with the FBI in Southeast Asia to break up these they're I think they're called scammer cities.

Amen.

And um you know a lot of it comes out of huge amount out of North Korea and unfortunately uh m- many of our seniors I think one out of every three seniors has been the subject of a financial scam that averages about three hundred dollars.

There's a special place in the afterlife for anybody that rips off an older American or or you know anybody old. I just I I hate that. Uh Mister uh Secretary we still have to solve health care. That's something that maybe we do agree on. on both sides of the aisle says we have to do better. What if Americans took charge of their own health care uh by having the money to do so? I've got a bill, uh HSAs for all, health savings account where people just like their retirement they can put money aside for health expenses uh to make that happen. Uh, Mister Secretary, is that bill, is that a good idea or a great idea, the bean bill of health savings accounts for all?

I I think it's a great name and a great bill.

That's the right answer, Mr. Secretary.

And a- and look uh the when when you give people agency, uh they they can tailor it to their own needs, and what we are seeing with the employee cr- employer credits, where employers can give credits, we're seeing a big uptake in that.

Love it, love it. Uh, Mr. Secretary, you could be doing anything, thank you for your service to your country, we appreciate you, all the best. Mister uh Chairman, I yield back.

Thank you, Mister Moran.

Uh, thank you, Mr. Chairman. Good afternoon, Secretary Besson. Thanks for being here today. I know it's a long day. Thanks for your service to our country as well. You're doing a fabulous job, by the way. We appreciate your willingness to appear before the committee and provide updates on the important work being done uh at the US Treasury Department. I'd like to build on some of the successes my Republican colleagues have already highlighted by focusing on two direct results from the working family's tax cuts both substantially improving Americans' lives and financial futures. First, I want to discuss the Opportunity Zone program. You mentioned this in in uh earlier testimony, specifically the new rural Opportunity Zone provisions. Last year, Ways and Means Republicans strengthened and modernized this program to ensure that investment reaches some of the most economically distressed communities in America. As someone who represents a large rural district in East Texas, I've seen firsthand the challenges that many communities face when it comes to attracting capital, creating jobs, and expanding economic opportunity. Too often rural communities are overlooked despite their tremendous potential. Here's my question, as we move closer to the nomination process, can you walk us through what comes next after census tracts are nominated by the states?

Uh, I I can't do that, sir. I'm happy to be have my the team get back to yours. We are working with red state and blue state governors, and we're cour encouraging them to get ahead of it. I had a call, I can't remember what it was yesterday or the day before with the father of Opportunity Zones my my hometown Senator uh S- Senator Tim Scott and uh we were talking about uh you know he's a city guy I'm a country guy in South Carolina and we were talking I was telling him what a great move this is for the rural Opportunity Zones and how it's gonna be transformational.

Yeah, I agree with you, uh that's what we see in this these provisions as well, that it gives certainty and long-lasting uh, opportunity for economic growth in areas in America where traditionally businesses or investors uh are looking and saying, you know, I'm not quite sure if I can make that investment there, but this is the incentive that's needed for that. Question number two involves the no taxes on overtime provision. N- uh, I wanna turn to this provision because I was proud to help champion this policy because it ex- it it uh recognizes a simple principle. Americans who work harder and put in extra hours should be able to keep more of what they earn. We've now learned that more than twenty-nine million filers have claimed that deduction this year, and notably ninety-six percent of those taxpayers earn less than two hundred thousand annually. Here's my question, Mister Secretary, do these results demonstrate that this law is delivering meaningful tax relief to working Americans? The men and women who are keep keeping our economy moving every day, and that the benefits are reaching middle class families rather than the wealthy as Democrats have falsely claimed.

Uh Congressman, I I tell you someone asked me earlier, uh, why do you do this job? And the highlight is going out and meeting the with our hard-working Americans being out with the people. And whether I'm in Texas, we're at a barbecue place outside of Dallas, uh, which I enjoyed. I was in an Italian restaurant in Simi Valley near the Reagan Museum this weekend. And that all all I hear from both the employees and the employers is what a home run this has been. And, you know, I I tell you, I I told the story earlier. Tax day, April fifteenth. I was with the president in Las Vegas. He had a big rally and he asked for, you know, the the room to he went through each one of the provisions and we're in the tip capital of the world in Las Vegas, but it was the no tax on overtime that got the roar of approval over the no tax on tips.

Yeah, I'm I'm finding the same thing as I go through my district, that's the number one provision that people are signing to me

it's it's the American way if you wanna work harder you should get to keep more of your money and you know I think uh the uh one of the congressman said well you know we we've gotta let let in these workers that we gotta have uh what if Americans wanna work more and keep more of their money

that's right you know I think that's a a concept we need to continue to uh propagate and find policies that support letting hard-working Americans keep more of their money we forget sometimes in DC and we shouldn't forget this, that it's their money, it's not ours. And I know you know that. I think you're doing, as I mentioned earlier, a great job. We really appreciate it. I wanna mention uh your uh successful negotiation of the side-by-side agreement that's helping to place the United States in a much stronger and more competitive position in the global tax landscape, digging us out of the Biden tax surrender effectively, and really putting us back on the footing we need to get on. So thank you for that work. I know you got a great team behind you as well. Uh, keep up the hard work and let us know what we can do. Thank you. Uh, you'll be.

Good.

Thank you, Congressman. Mister Schneider.

Thank you, and Mister Secretary, thank you uh for your patience staying here. I actually want to give you a chance to correct the record on something you said. You earlier commented somewhat offhandedly that the conflict with Iran had ended. Do you truly believe that we are no longer in conflict with Iran and that they are no longer a threat to Israel or allies in the Gulf that their nuclear program has been destroyed that they no longer have a b- ballistic missile program and drone program threatening our its neighbors in the region and that they will no longer sponsor terrorism in the region around the world

Uh so are you saying you're in agreement with the president's decision to the uh

Uh you said the conflict was over. I'm asking do you believe the conflict's over and everything's coposite?

the the the the the conflict is on pause.

So everything's good with Iran now.

Uh n- no, don't be absurd. Don't be absurd.

Well I'm a- I'm asking you to to clarify

Don't don't be absurd. That the uh as the president said yesterday, unless an American life the uh is lost, he does not believe that he will have to restart the kinetic acid.

OK, so you're you

Uh the we we we we we we we we we if you wanna be a deconstructionist and parse

I'm I'm I'm reclaiming my time and I'm I'm just trying to help you clear the record. I'm reclaiming my time, Mister Secretary,

and and you wanna parse my wording

can you promise, because this is your jurisdiction, that you and the Trump administration are not considering lifting sanctions on Iran as a concession towards opening the Straits of Hermuz?

Uh w- we've made it clear that the Straits of Hermuz, the the blockade there is the only thing that will be lifted to reopen the streets.

So no sanctions relief whatsoever.

Yeah, the I'm not part of the negotiating team, but I am told by the negotiating team and the uh I strongly believe that it will be the blockade will be lifted and and and and there's there is,

OK. And I'm gonna just reclaim, cuz there's a lot of things I wanna cover, uh my hope is you'll keep Congress informed

there is

of any such considerations if they do come up. Uh also in your opening remarks uh, Mister Secretary, you said Americans have more money in their pockets. That's not what I'm hearing from my constituents. Are you saying the overall cost of living is lower today than it was sixteen months ago when you came into office? Because what I'm hearing from my constituents is that the cost of groceries are up. For example, beef, coffee, tomatoes are at record or near record highs. The cost of housing is up. And for too many, the American dream of buying a home is out of reach. Yeah, cuz you wanna you you you wanna do an eye you wanna do an eye test? I'll I'll let you answer. Healthcare premiums continue to rise and millions of Americans have either already lost or expect to lose their health insurance altogether because of H R one, the bill you so joyously celebrate. Energy costs, gas for our cars, electricity for our homes are all rising through the roof. And family care, child care, and elder care is prohibitively costly. Are you saying that cost of living is lower today than it was a year ago?

No, no, I, I am saying that we are much closer to the Fed's target rate of two percent on core inflation than we were when President Trump came into office. We are at two point eight percent, and you can list off the most expensive groceries or the r- that have had the biggest price increases I gotta turn this on.

I I think you're just out of touch with what American families are facing.

The no no no,

As my colleague noted,

two, sir,

I'm reclaiming my time,

sir, yeah, you reclaim your time,

tariffs are a tax on American families,

it is two point five,

but I, this is my time,

two,

Mister Secretary,

two point five percent,

this is my time, I will speak and they're not

two point five percent.

Higher grocery prices are taxes on American families, higher gas and electricity prices are taxes on American families.

Well, you, you Democrats should know, no wonder so many people are leaving Illinois. Why don't you come see me in South Carolina?

This They're they're not leaving, they're c- they're coming to Illinois, just a simple question,

Wait, wait, wait,

Mister Secretary.

you're saying Illinois doesn't have net outbound migration?

All right, let me take you to a different topic,

All right.

and I know you don't want to address it, but my co- constituents are outraged and want me to talk to you about the absurd illegal self-dealing settlement between President Trump and his family with the Justice Department and the IRS over which you have jurisdiction. The administration apparently believes that there should be two systems of justice, two sets of laws, one for the president and his family and his rich friends like you, and one for the rest of us. Nothing demonstrates this more than the so-called settlement with its slush fund for insurrectionists and tax immunity for the president and his family. Mister Secretary, simple question. Do you believe that there should be only one legal system in this country, and that no one, even the President, should be above the law?

I believe that no one is above the law, but you all have put the President beneath the law, and you have weaponized the system against him, whether it is the leak of his taxpayer records,

His taxes should never be leaked.

whether it it

No taxpayers' information should be leaked.

it it

I agree with you on that.

that

But note,

and then then Congressman,

let me ask you a s- a separate question,

w- would you like to apologize to the President right now?

would you believe

On behalf of the United States and other countries.

I have nothing to apologize to this president for. His taxes should not have been leaked but it was leaked by a contractor and you keep trying to dissemble dissemble here and and avoid the questions.

I I'm a I'm happy

Do you believe that all Americans should pay the taxes they owe and not admit pen anymore?

Uh, hundred percent.

Yes or no? Alright. So do you think it applies to the president of the United States, irrespective of whether the president's a Democrat or a Republican?

Yes.

Okay. So we agree on this and we should have a tax system that is fair, and it should be f- applied fairly to all people. But I can tell you that my constituents are outraged by the agreement the President made with himself and his own Justice Department that excluded him from ever having an audit over his taxes. No one should be should be targeted. Uh, that that that's an accurate that's an accurate you you No one should be targeted by the administration, should you you sh- you should you should read the edit, whoever's in the in the White House. the you should read the edit in them. No one should be targeted by the administration, whoever's in the White House, their taxes should be paid, and they should be confident that that information will be kept confidential. with the IRS and not use to target them, their families or their business.

Couldn't agree more.

I yield back.

Couldn't agree more.

Mister Yackem.

Thank you, Mister Chairman, for holding this hearing today and Secretary Bessette, it is great to see you again. Thanks for being here.

Good to see you, Congressman.

There's been a lot of talk about the cost of groceries lately, uh, here in this committee room. A lot of numbers thrown around, but I think it's worth putting eyes on the Democrats' inflation. I had my staff whip up this chart behind me and it shows that CPI numbers from what economists call, quote, food at home, but most Americans just simply call it groceries. These are the cumulative inflation numbers for the first sixteen months of a presidential term of every presidential term since nineteen ninety three. Mister Secretary, the title most likely gives it away, but uh I'd like you to just play a little game with me here. Can you guess which one of these lines represents the Biden administration?

Oh, probably the one that's red for torturing the American people.

Uh, that would be correct. Uh, well done, Mister Secretary. Uh, it is the red one. Uh, sixteen months into the Biden administration, or as we now call it, uh, Bidenomics, grocery prices were up almost twelve percent. That far outpaced anything that any American had seen in recent history. Uh, and you can clearly see from the chart that that red line is as, uh, detached as the Democrats' rhetoric is from reality today on this particular topic. So, uh, thank you for, uh, playing along, uh, here today. Uh, switching gears, let's talk about tax priorities.

A- a- and, Congressman, I would note that the inconvenient truth for this side of the room, food at home, since President Trump came into office, is up two point five percent. That is the half, half of what it averaged over the four years of the Biden administration.

That's right. And that stands in stark contrast of the twelve percent that you saw on the chart here a few moments ago. So thank you for uh pointing that out. Uh, a two thousand nineteen New York Times story said that most taxpayers got a tax cut under the first Trump tax cuts. But most Americans didn't believe it because, quote, a sustained and misleading effort by liberal opponents of the law to brand it as a middle class tax increase. Here we are a few years later, and Republicans cut taxes again for working families and working Americans. But yet again, my Democrat colleagues are rolling out the same tired playbook of bad faith attacks and misinformation. The working families tax cuts cut taxes for working families. It's just that simple. I can't tell you, Mister Secretary, how many people have come up to me, whether it's at church or in the grocery store or just anywhere around the community, and they've said, hey, thank you, because my tax refund that I got was much bigger than what I expected. It's that the working family's tax cuts is just simply putting real money back in the pockets of working families.

And Congressman, I c- I can tell you when the when the two thousand seventeen tax bill was passed, I lived I was one of the people who now fled New York, but I lived in Manhattan, my taxes went up. So for many upper-end people in high-tax states, taxes actually went up.

That's right. And let's talk about some of the actual numbers and move beyond what some of the Democrats' rhetoric has been today. Uh, Mister Secretary, you recently said that uh ninety percent of filers claiming no tax on tips made less than who made less than one hundred thousand dollars they had an average deduction of seven thousand dollars. Seventy-five percent of filers claiming no tax on overtime made less than a hundred thousand dollars with an average deduction of thirty-one hundred dollars and sixty-eight percent of seniors claiming the enhanced deduction had incomes under a hundred thousand dollars with an average deduction of seventy-five hundred dollars does that sound directionally correct and roughly right to you and uh Mister Secretary are you aware of any

Uh that sounds pretty precise Congressman.

millionaires or billionaires that claim no tax on tips or no tax on overtime or the enhanced senior deduction.

Uh, no, sir.

No billionaires claiming any of this stuff.

Uh, uh, uh, again, uh, thi- this is the ultimate working family, the these are the ultimate working family signature tax cuts put through by this side of the room and President Trump.

That's right.

Well, thank you for clearing that up. Let's now consider what happened when Democrats had the pen and when they were able to craft their own tax law. A twenty twenty four analysis of households' claiming the green giveaways in Democrats' inflation reduction act, found that only forty-seven percent made less than a hundred thousand dollars. In fact, over a quarter of the households who took those deductions made over two hundred thousand dollars. And households making over a million dollars got nearly one hundred million taxpayer dollars worth of Democrats' green giveaways. Even Mother Jones had to admit that when it comes to Democrats' green giveaways, quote, " working class Americans are missing out." But if you think about it, it kind of makes sense, doesn't it? Mister Secretary, do you think that a family making less than a hundred thousand dollars cares more about no tax on tips or putting solar panels on their roof?

Uh, I think they're no tax on tips or the the subsidy for a high-priced EV.

And do you think that they would care more about no tax on overtime or solar panels on the roof?

Everyone I've spoken to loves no tax on overtime, sir.

So while Democrats gave millions to millionaires and while the the Republican working family's tax cuts, simply cut taxes for working families. Is that correct?

Hundred percent.

Thank you, Mister Secretary, and Mister Chairman, I yield back.

Thank you, Mister.

Thank you, Mister Chairman, and uh thank you, Mister Secretary, for sticking it out for over four hours here today. We appreciate your time and we appreciate your service to the nation.

Good to see you, sir.

So earlier today uh Mister Kelly uh from Pennsylvania was quoting from Charles Dickson Dickens he said it was the best

Tale of two cities.

A Tale of Two Cities, which is very appropriate for what we I think is see happening at this hearing here today.

Yeah, we we might say Manhattan and Dallas.

I wouldn't say that, but OK.

I would.

So, let's think about it. You said earlier today, and I'm sure you stick by this, the economy is very strong.

It is.

OK, so you say it's very strong, but we've heard consistently throughout the course of this

Uh, I am.

So that would seem to be a tale of two cities, you saying the economy is very strong and the people of the United States of America saying the economy is bad and getting worse. Now the Biden administration, which we've heard a lot from you guys today, I think made a similar mistake to what your administration is making. Because the stock market was booming under the Biden administration. There was a job creation under the Biden administration. Unemployment was low under the Biden administration. And the stock market is booming under this administration, that's true. And unemployment remains relatively low and there is some, but much reduced, job creation. But you're making a mistake, I think, to not listen to what the American people s- are saying, which is that they're very unhappy with the economy, because of the way it's affecting them. So have you heard of the expression, uh, the, uh, the " K" economy or the " K" recovery?

Uh, yes, sir, but I think we're probably moving to a " C" economy, where the top

OK, but I want to talk about the " K" economy for a second. We can get to " C" a little bit later. Is that OK? OK, so the " K" economy has one group of people going up and another group of people going down. It's a " K" economy. So in the " K" economy, the top group sees a booming stock market. But as you mentioned earlier, one of the reasons you wanted to do the, what you call, Trump is because ninety-three percent of the stock holdings in America are held by the top ten percent. But the lower income Americans, fifty percent of Americans, have only one percent of the stock holdings. So while the stock market may be booming, for much of the people in the United States of America, they have booming gas prices and booming grocery prices. In the K economy, we have your friends and some of friends of the people here that talk about buying second homes. But in the other part of the K economy that's going downwards, people can't afford to buy a home. Young people especially are foreclosed from being able to buy a home in this K economy. In the K economy, you have a group of people that are, their friends are talking about the great vacations they're going on. They're going to these exotic places they're doing these interesting things. In the other part of the K economy, people have a hard time paying their bills. So there's these two, tale of two cities that's taking place in the K economy here in the United States of America right now. Now, Mister Secretary, uh, you attended the President's inauguration, were you?

I did.

Yes, and at the his inauguration he said, "We're going to rapidly reduce prices." That was one of the quotes the President made during his inauguration he made many quotes like that during his administra- uh, his campaign as well. Do you think that the prices in the United States of America have been rapidly reduced?

I I think before the Iran conflict began that the rate of change for inflation, both headline and core, had come down substantially.

Well, people don't think that private prices have been rapidly reduced.

I mean, I I

So you do admit, though, that the war has caused prices to go up for gasoline, for example.

A a hundred percent.

And you also agree well, they didn't go up a hundred percent. Fifty percent. I I'm not so safe. They only went up fifty percent.

No, no, no, I I

But you agree with me a hundred percent.

Oh,

OK, that's better.

oh, that was I I'm glad to see somebody on this side is funny.

OK. So the second thing is that the Uh, tariffs. Do you think tariffs have caused prices to go up?

Uh, negatively.

You don't think prices have caused, gone up significantly because of, you just reduced pri- get uh tariffs the other day on farm equipment, cuz you wanted to reduce prices on farm equipment cuz you thought it caused the prices to go up.

But I, again, o- overall, the uh levels, what we saw last year was goods inflation was down.

Well, I would argue that tariffs have caused prices to go up and there's a lot of

Where's

economists and groups such as the Yale Budget Lab which u- used to teach it La- Yale,

Yeah, Yeah, and the the the Yale Bud- Budget Lab is a bunch of Biden-era second stringers. and the the the Yale Bud- Budget Lab is a bunch of Biden era second stringers.

OK, well you taught at Yale, I understand. You taught three classes, the twentieth century, financial booms and busts, hedge funds, and a seminar on financial panic of two thousand t- two thousand nine. So I don't know why you're no- knocking Yale. You used to teach at Yale. You went to Yale. Didn't you go to Yale?

That's why I get to l- knock Yale.

OK, so tariffs have caused prices to go up, the wars caused prices to go up. Do you think the deficits that were created by the big, beautiful bill are causing interest rates to stay artificially high?

No, but what I

No, but I'm asking you,

Mm.

do you think the deficits that were created by the big, beautiful pillar bill are causing interest rates to stay artificially high?

But

Yes or no? That's simple.

No, no, no.

I have, I'm out of time. Come on.

No, Congressman, we had a fiscal contraction last year,

OK.

so the deficit went down. So I I you should you you you you you should excrete your staffer.

Okay, I'm just gonna argue, Mr. Mr. Secretary, I'm just gonna I'm just gonna argue, Mr. Secretary, that prices are up, gas prices are up, grocery prices are up, energy prices are up, health care prices are up, interest rates are high, all specifically related to the policies of this administration. Mr. Secretary, thank you again for your service. I really appreciate it.

Good to see you Congressman. I wanna invite you to South Carolina to see all your former constituents.

Thank you.

Mister uh Mister Secretary, um Being a cattle farmer, I would say that the reason why the beef prices are high is the result of a very reduced herd. We don't have as many as cattle today as what we had decades ago. I know everyone keeps talking about beef prices around here, but it's a simple fact that we've had droughts, and people had to sell their herd to be be slaughtered, and so they no longer have the reproduction status quo, and that is why the beef prices are high regardless of what anyone wants to say. Um with that, Mister Secretary, um thank you for being here with us today. Thank you for the over four hours. Um please be advised that members have two 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. With that, the committee stands adjourned.

Good.