Count the ways: How GOP tax plans would reward rich families
Part of their prep school tuition could be shielded from taxes. A larger chunk of their inheritances would be free of estate tax. Family-owned businesses they have a stake in could be taxed at a discount. Stock portfolios gifted to them by their parents may keep climbing because of lower corporate tax rates. And their parents could enjoy a bigger child tax credit than poor working families would.
All told, such perks could further widen America's increased wealth gap.
"It's a pretty clear case to make that this helps wealthy children because they're the children of shareholders," said
Government and outside analyses of the
"You're going to be making so much money (you're) not going to know what to do with it, perhaps, I hope," the president said.
"It's precisely now that we buy insurance for that wage growth with a big tax reform," Hassett said.
Yet most mainstream economists and Democratic lawmakers have said the top 1 percent of earners are unlikely to spread around much of their expected windfalls. And the
Most
And if the individual tax cuts in the
"Over the long term, this is really one better than the Sheriff of Nottingham: It's taking from the poor and giving to the rich but doing so in a way so subtle that working-class Americans will really have to be paying attention to realize what's going on," Hemel said.
So just how would rich kids keep benefiting?
PRIVATE SCHOOLS
Tax-free profits from 529 college savings plans would now be eligible to cover
This change would largely serve the wealthy: Their enrollment in private schools has remained stable for the past half-century while middle class students increasingly rely on public schools, according to a research paper released this year by
The move would also worsen inequality by enabling wealthier parents to invest more in their children's schooling. Between 1972 and 2010, wealthier parents spent increasingly on the education of children under 6. The gap between their spending and those of poorer families has increased four-fold since 1972, the paper notes. Evidence suggests that this spending gap has continued to widen since 2010.
INHERITANCES
An estate tax is now paid on fortunes above
BUSINESS INCOME
Both the
This could further fuel income inequality.
STOCK HOLDINGS
Trump has bragged about the spectacular performance of the stock market since his election. Stock prices have climbed in part on the likelihood that corporate tax rates will be slashed to 20 percent from 35 percent. The
In 2016, the wealthiest 10 percent of households controlled 84 percent of stocks, according to research by
CHILD TAX CREDIT
Republican lawmakers would raise the Child Tax Credit, with the
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