Economy

Trump's Tax Proposal: Who Wins, Who Loses?

Trump's Tax Proposal: Who Wins, Who Loses?”

Pinar Cebi Wilber, chief economist at the American Council for Capital Formation, praised the Trump proposal to change how the foreign earnings of USA companies are taxed, which puts them at a disadvantage against foreign rivals. Trump first lies and says it won't help him (it saves him more than a billion dollars), then lies and says it helps millions of farmers and small business owners.

He continued, "That means, especially for all of you with small businesses that are really tremendous businesses, you'll be able to leave them to your family, and your family won't have to run out and do a fire sale to try and get the money to pay the tax". More than half (55%) of Republicans and Republican leaners with family incomes of $100,000 or more favor cutting tax rates on corporations and large businesses, as do 46% of those with incomes between $75,000 and $99,999.

Under Trump's proposal, the tax rates on compensation and business income would no longer be the same. Republican leaders in Congress have talked about substituting some kind of a tax credit instead.

McMahon said New York's upper middle class and wealthiest could potentially be the biggest losers under the income tax part of the proposal, because they pay relatively high state and local taxes.

The SALT deduction has been around since the Sixteenth Amendment to the U.S. Constitution was ratified in 1913, giving Congress the right to tax incomes. Vermont Sen. Bernie Sanders, the runner-up for the 2016 Democratic presidential nomination, called the Trump tax plan "morally repugnant" for "providing hundreds of billions in tax breaks to the wealthiest people".

The current tax system has seven brackets, but this will change to just 12, 25 and 35 percent. An EU commission released a report last week outlining plans to increase the taxes it collects from US technology companies.

Trump administration officials claim the tax cuts will pay for themselves by generating economic growth.

Malcolm Turnbull is looking to simplify Australia's tax system

British consumers, meanwhile, pay as much as 20 per cent in value added tax (the United Kingdom version of GST), compared to the Australian GST of 10 per cent.

A proposed tax framework reveals plans to consolidate the current tax brackets, eliminate several exemptions and deductions as well as cut individual and corporate taxes.

The pass-through category includes master limited partnership entities that have been the most important source of financing for oil and gas pipelines, particularly during the boom of shale oil and gas development.

But he added, "It's a pretty complicated calculation to figure out the pros and cons of".

State Comptroller Tom DiNapoli, whose office did an in-depth analysis of the federal tax proposals in July, said there are so many uncertainties as the process goes forward in Washington, it's very hard to pinpoint the exact effects on all New Yorkers. Wealthier New Yorkers would benefit from the proposed elimination of the estate tax. They have huge demands for hurricane relief. And they have defense needs if we're moving onto a potential war footing with North Korea.

ClearView Energy Partners was among the doubters, as well, in a commentary yesterday. And if the Republican Party gets its way, it could soon be his signature that decides how big they are, too. A recent paper examining the impact of the change concluded it resulted in "overwhelmingly" more tax avoidance. "As such, we give structural reform no more than 20 percent odds of success".



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