Agosto 10, 2020

Will the middle class get a real tax cut this year?

28 Setiembre 2017, 06:36 | Bibiana Flor

Will the middle class get a real tax cut this year?

Will the middle class get a real tax cut this year?

The plan anticipates reducing the tax rate for the wealthiest Americans to 35 percent from 39.6 percent.

"I think there is very little benefit for the rich", said Trump, who declined to announce his tax returns, unlike many of his predecessors at the White House.

"This package is completely designed with the middle class in mind", one of the officials said.

Toomey said the committees writing the tax bill will "wrestle with this and define this" in their drafting efforts. "We're coming back with this after taxes", said Senator Lindsey Graham, (R) SC.

But something tells us he won't be living off peanuts when this new framework comes into play.

The tax reform framework reduces the seven current income brackets down to three.

Also eliminated would be the personal exemptions, which let taxpayers deduct $4,050 per person in the household. Tax credits for families with children would be increased, and the standard deduction applicable to all Americans would be doubled in some cases. However, after six months of working on the plan, analysts say, "The outline still lacks vital details about how middle class families would fare". The rest take the standard deduction. They could put 20 percent down on paper and he could go out and say 15 percent anyway.

"The tax reform would increase the gross domestic product growth by 1 percentage point", which in 10 years "would amount to $10 trillion more GDP, $3 trillion more in revenue to the federal government", he said. "Today's proposal hints at some of the avenues that lawmakers will pursue to pay for their desired tax reductions; these include eliminating business tax credits, repealing individual itemized deductions and limiting business interest deductions".

Included in the group that drafted the tax plan are Treasury Secretary Steve Mnuchin, House Speaker Paul Ryan and Senate Majority Leader Mitch McConnell.

"We are determined to make smart investments in job creation programs and community colleges, make child care and education more affordable and strengthen retirement security for all Americans", he said.

A corporation in the 35 percent tax bracket repatriates $1 million of income earned overseas, it would owe $350,000 in US tax. In exchange for the lower rate, the White House wants to eliminate the corporate Alternative Minimum Tax.

"We want our companies to hire and grow in America, to raise wages for American workers, and to help rebuild American cities and towns", Trump said.

Passing the tax plan has become critical for a president desperate for a win. The Congressional Budget Office (CBO) found in an analysis that many other developed countries have been moving towards a more competitive tax system in the decades since.

The plan, entitled the "Unified Framework For Fixing Our Broken Tax Code", was announced jointly by the White House and Republican lawmakers heading the House and Senate Ways and Means Committees and is the working document whereby the administration is seeking to craft the biggest USA tax reform since 1980.

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