WASHINGTON (AP) — By slashing corporate tax rates, the Trump administration said Monday, the average U.S. household will get an estimated $4,000 more a year.
This stunning 5 percent increase is likely to be met with skepticism from tax experts and Democratic lawmakers. Spread across every U.S. household, the White House analysis claims it would generate “conservatively” an income jump totaling $504 billion, or about $200 billion more than the revenues currently generated by the corporate income tax.
With this new report, the White House is making a populist argument for its proposal to cut the 35 percent corporate tax rate to 20 percent. Trump has pitched his tax plan as supporting the middle class even though the details point to major companies and the wealthy as the biggest winners. Polls suggest that voters generally frown upon the idea of cutting taxes for businesses — essentially rewarding these firms for avoiding taxes by exploiting loopholes and keeping profits overseas.
The analysis by Kevin Hassett, chairman of the White House Council of Economic Advisers, said that the considerably lower rate would spur more investment by companies, which would then boost hiring and worker productivity. The average income gains from the reduced rate would range from $4,000 to as high as $9,000, the administration said. Those figures, however, rely on research arguing that workers — rather than investors — would primarily benefit from the lower corporate rates.
Separate studies, including a 2012 Treasury Department analysis, found that the vast majority of any savings would go to investors, making it unlikely to push up wages as much as the administration has argued. The administration removed the 2012 analysis from the Treasury Department’s website after releasing its tax framework last month with Republican congressional leaders.
Stocks surged after Trump’s election last year on the prospect of business tax cuts, but wage gains have been relatively tepid. Hassett said in a phone call with reporters that he expects salaries to begin climbing if the proposed tax overhaul is passed.
For individuals and families, the Trump plan would reduce the number of tax brackets to three from seven and double the standard deduction. But it would also remove the personal exemption and possibly much of the deduction for state and local taxes — changes that could possibly increase taxes for many families. A preliminary analysis by the nonpartisan Tax Policy Center estimated that the proposal would cut business taxes by $2.65 trillion over a decade while increasing the tax burden on families and individuals by $471 billion.
Hassett criticized those findings in a speech this month as a “fiction” that is “scientifically indefensible” because critical details of the proposal remain unknown. But Hassett said enough details are now known about the plan to support his conclusion that it would lead to income gains and stronger economic growth.
This is wingnut corporate welfare. No question about it. It doesn’t even benefit most small businesses in this country.
The stale analysis by this asshole in the WH is shilling the same old tired arguments of TRICKLE DOWN ECONOMICS, which have proven time and again to be complete bullshit. Is there any old disproven idea that these morons won’t pull out of their asses to sell to the American people just so they can give huge corporate tax breaks to their donors? It’s the only policy they’ve ever valued. This is just plain irresponsible. And one more plan that will weaken the health of the US economy…for no good reason other than to feed the 1%, including Rump himself.
It really is a shame when the GOP thinks they have to pass anything to prove they are capable of doing something, even if they already know it won’t work as intended, and will likely harm people. That’s how desperate they are for a win, of any kind. To what end though?
No tax plan should pass any house of Congress until we see that Orange Fucker’s taxes. Bottom line on all this.
Since $40 a year was obviously not going to cut it with voters, Trump said let’s just add a few more zeros to the estimate… as any Con Man would. The Top 1% feels that the middle class is so easily manipulated since Trump used the Russians to get elected.
Since when has anybody gotten a $4,000 raise without a promotion from their employer? It’s just not going to happen for American workers. We all are already going to have to go out on the open marketplace to find health insurance now that Trump has made it possible for small employers not to provide this benefit any longer with his executive order.
That $4000 raise and promotion would have been nice, but realistically who believes a thing Trump says? Really? This is the figure to keep in mind when you get screwed that much in healthcare costs over the coming year.
20% is about what they pay now on average, except of course for the many who pay 0% or even get a refund. Since Republicans are always bloviating about a flat income tax, let’s make the Corporate Tax flat instead. Every corporation pays 20% with 0 deductions.
Sure, and I have a bridge in Brooklyn that’s really cheap. The man will say anything and the deplorables will lap it up along with all the rest of the Liar in Chief’s garbage.
The administration removed the 2012 analysis from the Treasury Department’s website after releasing its tax framework last month
Good to see that Winston Smith is still employed, although now apparently at Treasury rather than Truth.