President Donald Trump’s tax reform plan will reportedly provide wealthy people such as Trump and members of his Cabinet with massive tax breaks while cutting services for the poor.
Pulitzer Prize-winning journalist David Cay Johnson explained Trump’s plan to Democracy Now:
Well, essentially, what the Trump tax plan, to the extent that we know what it is, Amy, is a plan to give tiny little tax cuts to most Americans, raise taxes on perhaps one in five families and shower benefits on people who earn millions of dollars a year.
If you make $40,000 to $50,000, the Institute on Taxation and Economic Policy estimates you’ll get a tax savings of about $8 a week. If you make an income of $10 million, you’re going to save about a million-and-a-half dollars a year. As much as two-thirds of the tax cuts will go to the 1 percent.
And this fits with a fundamental principle the Republicans have been pursuing for a long time. They don’t use these words, but it boils down to: The rich aren’t investing and creating jobs, because they don’t have nearly enough money, and so we need to get them money.
And the way the Republicans want to get it to them is tax cuts first, and then, when there’s no money because of the tax cuts, to take away help for children, the disabled, the elderly and the poor.
Johnson notes on his news site DCReport.org:
“Trump Will Pay Less Tax. The top tax rate on partnerships and limited liability companies would fall from 39.6% to 25%. Trump has more than 500 such businesses. His tax rate would fall by more than a third.”
“The corporate tax rate would be cut from 35% to 20%. This at a time when corporations have record amounts of cash and interest rates are super low. The savings will make it easier to buy back stocks, which makes executive stock options more valuable because fewer shares make each share more valuable.”
“Companies that used accounting to convert profits earned in America into tax-deductible expenses paid to their offshore subsidiaries will get a tax holiday, bringing the profits back with little or no tax. The taxes avoided by moving money offshore are in effect loans from Uncle Sam at zero-percent interest so this would be a double dip of corporate welfare.”