Just Released Analysis: Trump's Tax plan to Cost Outrageous Amount and Mostly Help the Rich - ProgressTribune.com
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Just Released Analysis: Trump’s Tax plan to Cost Outrageous Amount and Mostly Help the Rich

The tax framework that President Trump and congressional Republicans offered this week would reduce federal revenues by $2.4 trillion in the first 10 years and provide the biggest tax cuts to the richest Americans, according to an analysis published Friday by the nonpartisan Tax Policy Center (TPC).

The plan would cost $3.2 trillion in its second decade, the TPC said.

Every income group, on average, would see a decrease in their tax bill in the first year under the plan, according to the TPC, but the nation’s richest would get the lion’s share of savings.

Democrats seized on the TPC’s findings to batter Trump’s proposal.

“This report on Trump’s tax scam is more hard evidence that the president and his out-of-touch millionaire advisors are executing a middle-class con job,” said Senator Ron Wyden (Oregon), the top Democrat on the Senate Finance Committee.

The bottom 95 percent of earners would receive on average an increase in their after-tax income of 1.2 percent or less. The top 1 percent, would see an 8.5 percent increase, TPC said.

In the plan’s first year, taxpayers on average would get a tax cut of $1,570, while those in the top 1 percent would see their taxes lowered on average by about $130,000. About 12 percent of taxpayers would have their taxes go up that year including more than one-third of people earning between about $150,000 to $300,000, largely due to the repeal of a lot of itemized deductions, TPC said.

Over time, the effect of the tax changes would be reduced on the lower end of the income spectrum.

“About 80 percent of the total benefit would accrue to taxpayers in the top 1 percent, whose after-tax income would increase 8.7 percent¬Ě by 2027,” the report said.

By that point, about 25 percent of taxpayers would have their taxes go up, particularly among the middle and upper-middle class. Almost 30 percent of people with incomes between $50,000 and $150,000 would see their tax bill go up, as would 60 percent of those earning between $150,000 and $300,000, TPC said.

In 2027, taxpayers would get a decrease in taxes of almost $1,700, but those in the top 1 percent would see an average cut of above $200,000 and those in the top 0.1 percent would see a average decrease of more than $1 million, according to TPC. Taxpayers in the middle fifth of income would on average get a reduction in taxes of $660.

The Republican tax plan calls for reducing the number of individual brackets from seven to three: 12 percent, 25 percent and 35 percent. The plan said tax writers could propose an additional tax bracket above 35 percent that wasn’t part of the TPC’s analysis.

For businesses, the framework would cut the corporate tax rate from 35 percent to 20 percent and decrease the top tax rate for “pass-through” businesses, whose income is taxed through the individual code, down to 25 percent. The plan would allow businesses to instantly write off the full costs of their investments for more than five years, while partially limiting corporations’ ability to deduct interest.

The TPC found that alterations to the individual tax code would raise $470 billion in its first 10 years, while the business provisions would cost a horrifying $2.6 trillion and getting rid of the estate tax would cost $240 billion.

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