Trump proposes his tax reform plan

Share
Trump proposes his tax reform plan

President Donald Trump said the "rebirth of American industry is beginning" as he pushed his tax plan to the National Association of Manufacturers Friday. Reducing the corporate tax rate from 35 to 20 percent costs about $2 trillion over 10 years, while capping the rate on "pass-through" companies - like those in the Trump Organization - to 25 percent (down from 39.6 percent today) costs about $770 billion. Those are important details, which will be sorted out by Congress.

Congressional Republicans describe the change as creating a larger "zero tax bracket". Our commitment to those affected is this: We are with you, we will stay with you, and we will come back stronger than ever.

The TPC analysis says the average household in the top quintile would see its tax bill decline by $8,470 in 2018 under the plan - a drop of 2.4 percentage points from the average federal tax rate.

Meanwhile, as the New York Times noted, more than a third of Americans making between $150,000 to $300,000 face a possible tax increase, not a tax decrease.

Overall, the plan increases individual income taxes by $470 billion; cuts business taxes by $2.6 trillion; and cuts the estate tax by $240 billion.

"The top 0.1 percent would get an average boost in after-tax income of $720,000 or 10.2 percent of their after-tax income".

The report says the average tax bill for all income groups would go down in 2018 if the framework were implemented - but what's eye-popping is how much the highest-earning Americans would save.

In the address, Trump also reviewed policy changes since he took office in January that he said are meant to improve the business climate, including lifting restrictions on energy production, reversing environmental rules and rolling back regulations.

White House officials have given conflicting accounts of the impact of the tax cuts on the wealthy.

While U.S. statutory tax rates are higher, the effective tax rate paid by corporations is in fact roughly equivalent to the effective tax rates of our peer countries, due to loopholes in the U.S. tax code. "Everyday Americans and future generations lose under the Trump tax plan, while the wealthy keep winning". Under current law, the money is taxed if it is brought back to the U.S. Married couples get at least $20,800: $12,700 for the standard deduction and two personal exemptions of $4,050 each.

This provision would allow middle-class families to shield more of their income from taxation.

For individual taxpayers, the plan would collapse the tax brackets to three from seven, lowering rates for many while doubling the standard deduction and increasing the child tax credit.

The same can not be said of the planned abolition of the estate (inheritance) tax, which would benefit only those with assets worth $5.5m or more. Or it would be forced to run the national debt up to unsafe levels, likely driving up borrowing rates for consumers and businesses. That added growth would, they say, generate revenue to cover the remainder of the cost of the tax cut. Of course, this would not affect municipal bonds because the tax exemption for municipal bonds is not an itemized deduction (this was a test for our readers). About 30 percent of USA taxpayers itemize their deductions. In either case, with a greatly expanded standard deduction and far fewer itemized deductions, it seems likely that almost everyone would be better off taking standard deductions under the proposed system.

The GOP framework calls for retaining the deductions for mortgage interest and charitable contributions, which "help accomplish important goals that strengthen civil society. homeownership and charitable giving".

Share

Advertisement

Related Posts

The President Pushes For Tax Overhaul
Two different tax rates will be applied: one for cash and cash equivalents, and another, lower rate for illiquid assets. So a married couple up to $24,000 can spend their money on their family, on their children, what they have to do.

Tiger Woods admits he may not play again competitively
We know how to help each other out, pick people up and also pull them back if they're getting too excited. It was fun to celebrate his PGA Championship win with him and Rickie, and we had a blast.

Harry Kane nets two more goals Spurs beat Huddersfield 4-0
Huddersfield managed just six shots in this game - only twice in its previous 107 league games had it attempted fewer in a match. Harry Winks made his first Premier League start since April on Saturday and barely looked as if he had been away.

Georgia's Nick Chubb has final word at Tennessee
Bob Shoop's group responded and forced a field goal, but it immediately turned the game in Georgia's favor. Bennett made the trip to Notre Dame to be Georgia's third quarterback when Eason was ruled out.

Last second field goal dooms the Patriots against the Panthers
On the next play, Panthers running back Jonathan Stewart carried up the middle for a 15-yard gain, putting Carolina near midfield. Newton appeared more like his 2015 self, tossing for 316 yards and three touchdowns on 22-of-29 passing. "We'll get it done".

Internationals battling at Presidents Cup
I'm hoping that I can redeem myself this week. "You start to kind of look forward and wonder where this momentum could take us". You dream of moments like this". "It was a disappointing result, but could've been worse", added Leishman.

China Still Bringing In Boatloads Of North Korean Coal Despite Ban
Speaking in Beijing on Monday, Chinese Foreign Ministry spokesman Lu Kang said war on the Korean Peninsula would have no victor . It also ordered North Korean companies in the country and those in joint ventures with Chinese businesses to close.

Lineups for Manchester United vs Crystal Palace announced
Crystal Palace: 4-2-3-1Hennessey, Ward, Dann, Sakho, Aanholt, Milivojevic, Cabaye, Townsend, Schlupp, Loftus-Cheek, and Sako. The Swedish legend will have a part to play when he returns from injury, but he won't be a regular starter ahead of Lukaku.

As Hurricane Maria Devastation Endures, Bostonians Look For Ways To Help
As Hurricane Maria swept through the island, it has caused significant damage to its infrastructure including its roads. For politicians and everyday New Yorkers, the storm is pulling at the ties between their state and Puerto Rico.

This reader supports Trump on national anthem
They blasted Trump's words as divisive, contentious, misguided, uninformed, disappointing, inappropriate and offensive. On Sunday, almost the whole league - including owners and coaches - was united in protest and solidarity.

© 2015 Stocks News Daily. All Rights reserved.