The Republican tax plan would boost the fortunes of the middle-class by providing tax cuts for businesses and individuals, but the bill also includes significant tax breaks for the rich, including the largest tax cut in history for the top 1 percent of earners.
The Tax Policy Center found that the average tax cut for the average income bracket would be $2,700 for a married couple earning $200,000 in 2019.
That’s about $800 higher than the CBO’s baseline scenario in which the average middle-income family would see an average tax bill increase of $3,800.
Republicans say that the GOP plan would spur economic growth and improve economic security by eliminating the top corporate tax rate from 35 percent to 20 percent.
The nonpartisan Tax Policy Institute, however, has estimated that under current tax law, the top marginal tax rate would rise from 35 to 39.6 percent, or more than triple.
At a time when Republicans are struggling to pass a $1 trillion tax cut that would give all Americans the biggest tax cut of any major political party, the Trump administration has been using its power to make tax cuts far larger for the wealthiest Americans.
Trump has called for an increase in the top rate on corporate profits to 35 percent.
But his plan includes a massive corporate tax cut, with the top individual rate going from 35% to 25 percent.
Trump’s tax plan, which he unveiled last month, is aimed at helping the richest Americans, while the poorest Americans get hurt.
The Tax Policy Foundation, which analyzes tax proposals across the political spectrum, estimates that Trump’s plan would reduce economic growth by $8.6 trillion over 10 years.
It estimates that the corporate tax cuts would add an additional $4.9 trillion to the deficit over the next decade.
In addition to the corporate and individual tax cuts, the bill includes massive tax breaks that benefit wealthy people, like a doubling of the standard deduction, the repeal of the estate tax, and a reduction in the corporate rate from 33 percent to 21 percent.
It also would give the wealthy a break on their taxes by eliminating some deductions and credits.
Trump’s proposed cuts would also give wealthy people an incentive to keep more of their money offshore, and to hold on to it.
The tax plan also would benefit some low- and middle-wage workers, including those who rely on a part-time job for their income.
But it would leave many of those workers behind in their fight to get a raise, and it would put their children and grandchildren at a huge financial disadvantage.
GOP leaders are trying to pass the bill in a lame duck session in order to avoid a government shutdown.
The House will be back in session this week, and Republicans will have to make concessions to Democrats and other Democrats in order for it to pass.
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