Same old plan … or reform at last?
With the
Trump unveiled a series of ideas Wednesday that would reduce the number of income tax brackets from seven to three, slash the federal corporate tax from 35 percent to 20 percent, scrap scores of loopholes and double the standard deduction to provide many middle-income Americans with a tax reduction.
“Opponents of tax reform trot out the argument that the
Skeptics say that beneath the seductive promise of a simple tax code blended with a middle-class tax cut, the proposed plan mostly contains warmed over ideas from Republican-backed tax reductions in 1981 and 2001, which they say caused soaring federal deficits.
They point out that the plan probably would reduce federal tax revenue by an aggregate of
“I thought they would have to do something that would claim to be revenue-neutral,” said
“Tax reform is incredibly important,” said
“When the voters voted for change last year, the change they were talking about was relief of economic anxiety in this country,” Bliss said. “And passing a middle-class tax cut will be vital to electoral success in 2018.”
At the heart of the debate is whether tax cuts stimulate economic growth to generate enough tax revenue to keep federal deficits under control. Although the economy boomed after
The
“This is pro-growth tax reform and at the end of the day, I’m not for blowing a hole in the deficit,” said Sen.
In particular, conservative economists such as Ohanian say that nothing is more important than making American companies more competitive in the world.
“Reducing the corporate tax rate is front and center the most important,“ Ohanian said. ”If we can make just one change, I would make that.”
Critics counter that conservatives are engaging in wishful thinking. They point out that Democratic Presidents
Writing last year for RealClearPolitics.com,
They also point out
“No matter what was going on in the economy,
For
In reality, both political parties are responsible for the massive debt as
By 2027, the
“My biggest concern if they pass a big deficit-financed tax cut is that the same people who supported that tax cut and were freaking out over the deficit under Obama, will turn right around ... and use the larger deficit as a way to make the (spending) cuts they want to make,” Stein said.
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