Published: Mon, May 01, 2017
Local | By Dorothy Bennett

Trump's tax plan could cost an estimated $5.5 trillion


Currently, 15% is the lowest bracket for businesses, so this tax cut would lower taxes significantly for almost all businesses that earn more than $50,000 a year.

"The tax plan will pay for itself with economic growth", Treasury Secretary Steven Mnuchin, assured this week. When pressed with the fact that Trump's plan would result in large tax reductions for rich people in general, and Donald Trump in particular, Mnuchin simply insisted, over and over, that the plan was not "about" that.

Trump also calls for eliminating the estate tax.

"That's the heavy lift", said Rep. Dave Brat, R-Va. It will be the projects and services most affecting average Americans that will go away.

"We are a poor state", Bailey said. We say plan, but on a single page, it's more of list of talking points, devoid of detail.

In a sign of unity, House and Senate leaders and their money committee chairmen issued the following joint statement. If individuals declare themselves "pass-through entities", under this plan, they can be taxed at the corporate tax rate. The numbers here are uncertain, as the plan includes few details so far.

It also omits much of the work that Ryan and other Republicans have done to craft a comprehensive plan. The plan would trim other deductions used by high-income Americans, including state and local tax payments. The alternative minimum tax is meant to prevent high earners from being able to avoid all income taxes but can also affect middle-income taxpayers.

But the true effect of this tax cut will depend on how the Trump administration defines a small business owner.

"We feel confident that we can get to at least 3 percent economic growth on a sustained basis", said Mnuchin.

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"I would guess that most Americans would applaud what the president is doing", Spicer said.

It would double the standard deduction individuals can take and proposes cutting the corporate tax rate from 35 percent to 15 percent.

During the campaign, Trump released a tax proposal that would eliminate the personal exemption.

So if you're scoring at home, a family of five that now claims the standard deduction will actually lose deductions under the Trump plan. Congress now has to decide how best to get there.

For individuals and families, Trump's plan more closely resembles a blueprint released by House Republicans a year ago.

The Trump administration Wednesday put forth a proposal that it labeled a "massive" tax overhaul, which would give big tax cuts to individuals and corporations and reduce the number of tax brackets and deductions. The top income tax rate would be reduced from 39.6 percent to 35 percent.

Standard deductions and individual deductions: The new plan would double the standard deduction, which is now $6,350 for single filers and $12,700 for married couples.

The median household income in the U.S.is about $55,000, though people living in high-cost areas can make much more than that and still feel like they are in the middle class.

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