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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsTrump reportedly plans to raise bottom tax rate to offset tax cuts for wealthy
REBEKAH ENTRALGO at Think Progress
https://thinkprogress.org/trump-reportedly-to-plans-to-raise-bottom-tax-rate-to-offset-tax-cuts-for-wealthy-55f07ec0b470/
"SNIP.........
With multiple failed attempts at repealing and replacing the Affordable Care Act, all eyes are on Republicans as they prepare to pass major tax reform measures that would effectively provide a hefty tax cut to the top tax bracket while lowering the corporate tax rate to around 20 percent from 35 percent.
As President Donald Trump prepares to announce his plan to cut taxes tremendously for the middle-class tomorrow, details about the tax reform plan, which was largely constructed in secrecy by former Goldman Sachs employees now in the administration, are beginning to make their way to the public. On Tuesday, Axios reported Republicans have agreed on a plan to raise the bottom tax rate from 10 percent to 12 percent, while also doubling the standard deduction.
This increase in the bottom tax rate is one of the ways the Trump administration is planning on paying for the massive tax cut for the rich. Trumps plan is expected to slash the top individual tax rate from 39.5 percent to 35 percent.
[Republicans] are clearly looking for ways to offset the enormous tax cuts their plan gives to the wealthy and corporations. Just the tax cuts that have been reported would cost $5 trillion, said Seth Hanlon, senior fellow specializing in tax policy at the Center For American Progress. (Disclosure: ThinkProgress is an editorially independent site housed at the Center for American Progress Action Fund, the sister organization of the Center for American Progress.)
..........SNIP"
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exboyfil
(17,862 posts)For a married couple.
Johnny2X2X
(19,037 posts)$24K, not $34K. $12 K for individuals. So the higher rate is off set by this though. They're getting rid of some deductions too. It could be a wash or a slight gain for low income families.
For lower middle class and middle class it all depends on where the tax brackets fall (which they haven't released yet). If the 12% bracket goes up to $50K this could be really good for working families. If it only goes up to $30K, this could be really bad for working families.
The corporate rate only works if you eliminate almost all of the loopholes and make the theoretical rate close to equal to the actual rate paid.
The rich do not need a stinking tax break. The elimination of the Estate tax is terrible for our Democracy.
exboyfil
(17,862 posts)I didn't know they were rolling the exemptions into the deduction (sneaky little devils).
Agree with you on the estate in part. I could handle no change in basis and capital gains taxes due at death. I would even throw in a CPI adjustment. I don't know the implications, but even estates in the $1M+ range should also pay at death.
I am thinking about doing an essay on the Jewish jubilee commanded in the Bible. They understood what wealth concentration over time would imply for their society.
Johnny2X2X
(19,037 posts)It actually doesn't sound all that cruel at first glance, but that can't be. This group of miscreants have done nothing but try to make the lives of the poor and middle class miserable, by the time this law solidifies it will likely totally screw over the poor and working class. Nothing they have done suggests they are changing.
Personally, I'd like to see all income under $30K for individuals exempt, $60K for married couples. If Reps then want a flatter tax after that, that would be a good trade off. Corporations right now barely pay taxes, eliminating the loopholes and lowering the rate could raise revenues and promote business.
The estate tax needs to be increased, the founding fathers weren't sure they wanted inherited wealth at all in this country. a graduated estate tax would be best for the country. Say 0% on anything under $1.M all the way up to 80% on anything over $100M.
HuskyOffset
(888 posts)Sick of ultra-wealthy assholes paying only 15% on their income.
KT2000
(20,572 posts)are 28%. For that they get healthcare, education, senior assisted living and more.
Merlot
(9,696 posts)Americans don't get what we pay for in taxes. We get military spending and handouts to corporations instead of the things that we should be getting with our taxes like infrastructure, health care, better schools, etc.
KT2000
(20,572 posts)of losing everything to healthcare and senior care like Americans.
Hoyt
(54,770 posts)We'll see.
karynnj
(59,501 posts)Consider a middle class family in New Jersey where state taxes (income and property taxes) are high and homes are expensive. A family with kids will lose the exemptions and it is very possible that they previously itemized getting as much or close to the new standard deduction. At this point there is too much undefined, but it already seems that many people who most would consider middle class will pay more.
Here is one attempt to analyze some major impacts
https://www.nbcnews.com/politics/donald-trump/tax-plan-impact-mystery-middle-class-not-trump-n805331
What is clear is who the biggest beneficiaries are - Paul Krugman linked to an analysis that estimates that a full 30 percent of the gains will go to the top .1%; 50% will go to the top 1%.
Link to tweet
With absolutely no other information, it seems very likely that this will either explode the deficit -- and they will be back demanding all social welfare programs be cut because of the deficit OR in aggregate, the bottom 99% will be paying more.
Just what we needed - a tax plan to increase income inequality! (I hope
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dawg
(10,624 posts)So a family with more than two children might be hard-pressed not to see a tax *increase*.
Or, consider a married couple who normally has around $24,000 in itemized deductions. Now, they get a $24,000 standard deduction instead, plus they lose the benefit of their personal exemptions and their bottom tax rate is raised from 10% to 12%. Yay!
Hoyt
(54,770 posts)Angry Dragon
(36,693 posts)randr
(12,409 posts)The illiterate lsos will support whatever his fat cat contributors hand him, or not, or maybe we'll have to see.
dawg
(10,624 posts)I'm in danger of seeing a pretty significant tax *increase* from this piece of shit tax plan.