(Last updated 16 November 2017, 5:13 am BST)
If the new tax plan in America were to pass, and, it has at least passed its first hurdle — more than ever before the wealthy and the rich would automatically benefit more than anyone else. Announced today, the bill originally proposed by Trump himself during his campaign — passed its first major hurdle. Whether or not such a plan will clear Congress, among other places, remains to be seen as of this time.
The Tax Cuts and Jobs Act – Defined
As many experts have already pointed out, the “cuts” are actually at least partially only temporary. The key point of this tax-act, or what it is actually meant for, is to enrich the pocketbooks and lives of the millionaires and billionaires currently in power in the United States. First and foremost, we’d like to point out that Trump has previously asked Congress to use the savings from the tax-plan as means to lower the top tax rate to just 20% from 35% (but not apparently until 2019).
There are two version of the bill, both, which cut income tax rates; double standard deductions, but also eliminate personal exemptions. The Senate version of the bill demands that the penalty for those who don’t sign up for Obamacare during open enrollment, be, entirely abolished. If such were to happen, the government would save about $338billion in financial means. However, the CBO estimates that some 13 million Americans would no longer get health insurance “because they wouldn’t feel like itsi mportant”.
Trump ‘s High Hopes
In those savings, totaling $338billion, Trump has previously asked Congress to use those savings to pay to cut the top rate of them all down from 35%. Trump ‘s other hopes, however, may have some deeper implications on life in our world than one might imagine. Quietly, on November 15th, the Senate added a provision to their version of the bill that would allow oil drilling and certain extents of mining in the Arctic National Refuge.
In the Arctic Refuge people. In Trump ‘s Administration, nothing is off limits. While it is estimated that such drilling would result in billions in revenue over the course of ten years, such mining, wouldn’t be actually considered completey profitable until oil once again hits about $70 a barrel according to tax and financial experts in New York City.
What about income tax brackets?
The Senate version of the bill hopes to keep all seven tax brackets, but, hopes to lower the rates in only some of them.
The Senate Version:
|Income Tax Rate||Income Levels for Those Filing As:|
|10%||10%||$0-$9,525||$0 – $19,050|
|15%||12%||$9,525 – $38,700||$19,050 – $77,400|
|25%||22.5%||$38,700 – $60,000||$77,400 – $120,000|
|25% – 28%||25%||$60,000 – $170,000||$120,000 – $390,000|
|33%||32.5%||$170,000 – $200,000||$390,000 – $450,000|
|33% – 35%||35%||$200,000 – $500,000||$450,000 – $1M|
The House Version:
|Income Tax Rate||Income Levels for Those Filing As:|
|10 – 15%||12%||$0-$44,999||$0 – $89,999|
|25 – 28%||25%||$45,000 – $199,999||$90,000 – $259,999|
|28 – 39.6%||35%||$200,000 – $499,999||$260,000 – $999,999|
What’s the move on deducations?
Students in the Senate version of the bill will be able to deduct interest payments and such paid while in school. In the House version, sorry guys, it would no longer be a thing for young taxpayers. Deducations for state and local taxes across the board, ehum, would also disappear. CBO reports and experts estimate that this would hurt some 44 million average Americans. Meanwhile, still lining the pockets of the rich.
Much beloved by the billionaires who largely bought Trump ‘s ascension to the Presidency, the estate tax as of 2024 would also disappear. The IRS says that of the top 1% earners in America, that’s just under a total of 4,918 tax returns. Those top earners contribute some $17billion to the US tax system and the economy.
The nitty-gritty for business taxes
Despite the erroneous claims made by Trump, most billion-dollar companies that would normally be subjected to the 35% tax rate don’t actually pay such a rate. That, ehum, is mostly because they can afford top notch tax attorneys that help them by getting them out of paying such a rate. It has been public knowledge for years that allot of corporations in America only actually pay about 15% of such a tax rate.
Despite such, both tax plans would cut the rate from 35% to just 20%. One woul delay it until beyond 2020 and it would only be temporary, but, the other would delay it until next year. And after next years delayal, unfortunately, it would become permanent.
The final determination
An ISI report does indeed note that the Senate plan would benefit many Americans, while the House plan, indeed would not and eventually by 2027 cause an increase in taxes. The ISI report notes that under the Senate plan, about 6 million Americans, would actually benefit from the standard deductions increase alone. That’s about 47% of all US taxpayers whom are of age. Meanwhile, the House plan would only suffice to about 31% of all taxpayers according to several studies.
A Wharton School of Business Study found that over the course of about 10 years, the national debt in the U.S, would increase by trillions.
Like it has already been pointed out before, for example, eliminating minor things like the penalty for no health insurance could potentially have grave consequences for other taxpayers in terms of healthcare. Republicans aren’t stopping to think that eliminating such a thing, likely, would result in higher premiums for others to offset the cost differences.
The Senate bill is certainly better than the House bill, but both, still in the end enrich the lives of the rich by cutting essential taxes that only they would really even qualify to have to pay to begin with.