Posted on 09/24/2017 10:16:17 AM PDT by SeekAndFind
The big change: The GOP leaders and the White House plan to cut the top tax rate for “pass through" businesses from 39.6 percent to 25 percent. (Most businesses in America do not pay the corporate tax. Sole proprietors and other mostly smaller businesses see their profits “passed through” to their owners and taxed at the individual income rate.)
The so-called "Big Six" tax framework — named because it's been hashed out behind closed doors between six top Republicans and administration officials — will set up a clash with Democrats over the tax breaks that apply to large corporations and upper income Americans.
What's next: President Trump is planning to give a speech unveiling the Big Six framework in Indiana on Wednesday, three sources said. The framework is the starting point for the tax reform process. It reflects the shared view of the Big Six, but it will inevitably change substantially as it goes through the normal legislative processes in the House and Senate.
(The "Big Six" are House Speaker Paul Ryan, Senate Majority Leader Mitch McConnell, Treasury secretary Steven Mnuchin, White House economic adviser Gary Cohn, and the chairmen of the two tax-writing committees — Senate Finance Committee chairman Orrin Hatch and House Ways and Means chairman Kevin Brady.)
The details, per three sources with knowledge of the plan:
These Big Six decisions have been held incredibly tightly, but details began leaking out around Capitol Hill on Friday night and the corporate rate was first published by the Washington Post's Hill team. By Saturday, influential figures on K Street were beginning to learn more details.
Some problems the Big Six could run into:
That 20% corporate rate will insure that American companies will keep their cash stashes in place overseas, and that none of those companies will be bringing any of their operations back to the states.
That 20% is just to say that, “well, we tried” with no real effort to do what’s really needed to kick-start or wake up a lackluster economy.
It’s a move in the right direction. It doesn’t go far enough to suit me, but half measures are better than no measures. BUT: the chances of getting 60 votes in the Senate are approximately zero, and I’m erring on the high side ....
Cuts are not reform.
What is the middle rates... those are the ones eating most folks alive
NO, not as long as these people keep trying to tear down our border nor as long as their Corporate media smears us. I used to think we should give all of them tax breaks. Now I think if the corporates and the Chamber of Commerce types are going to sell out to even wealthier elites in the Dem party an globalists then we should Raise their taxes especially if they are just going to give jobs to the cheap labor express. We need a new conservatism that works for conservatives not just the Chamber of Commerce.
What happened to simplification? Why does there have to be any tax rate but ONE?
I guess I’ll get a refund for all I paid at the 39.6% marginal rate for small business profits? NOT.
Why should corporations be taxed at 20% and small business be taxed at 25% any more than anyone should pay anything but a flat rate on all INCOME after a living expense deduction?
It is all screwed up and will stay that way.
IOW:
People like you sent him a congress full of McCains.
But Trump’s responsibility is to make up for that by proposing something these people will not pass, but should do so anyway, because it is more entertaining to lose on something that wont pass than to advance the ball on something that will.
365 days ago you didn’t have a chance of anything passing. So I’ll suggest not trying to use this to virtue signal off of about how “pathetic” you think it is, and do your bit to send a congress to DC that can pass whatever fantasy number you would rather have.
RE: Cuts are not reform
We all know that and so does Trump and the GOP. But this is the only politically feasible move at the moment and should be implemented.
We did not get to our convoluted tax system overnight but incrementally, spanning decades. I suspect it will take just as long to reform it.
RE: Axios is a useless source.
I’ve actually found their reporters to be more sober and desirous to dig the truth than most other sources.
Does the journalist who calls it a reform know this?
I was wanting actual tax reform. I know they’ll never do it but a straight 10-15 percent, fill in the card and send it in. THAT’S tax reform. They’re just monkeying around with the rates and 50% of the country still won’t be paying taxes.
Yep, he fell in fast.
“How about putting the 40% tax bracket at $10 million, the 30% bracket at $1 million, the 20% bracket at $100,000 & exempting the first $100,000 income from taxation? That eliminates all deductions except one, & reduces the tax code to just 3 tax brackets AND...more important...it makes the tax code un-STEEP. Steepness of the code is why educated professionals don’t vote Republican because they get hit with highest tax brackets, as if they are millionaires & billionaires, which they are not.”
“The income tax AND the corporate income tax were meant to tax the rich ONLY, not workers or professionals. We claim to value WORK, but we income tax the same work 4 times at the federal level alone, then 3 or 4 times at the state & local level with income taxes & property taxes which come out of income.”
“The corporate income tax is one way the richest avoid income taxes, so lowering the rate gives them a bigger tax dodge. but at least with a flat tax, all rates are equalized....and a flat tax would be fine if you exempted the first $50,000 at least & got rid of payroll taxes first.”
“....so it would be optimal to reward trading WORK for money by not taxing WORK from the bottom up, instead of having too low rates for those who trade stock for money or businesses for money or real estate for money. There’s plenty of risk in taking a job & working for a living...& even more risk for small business owners who put up their life savings & all their time trying to succeed in their own business, but pay tax at much higher rates than billionaire rentiers & vulture capitalists, who risk little time or money of their own...& can afford the risk, too. They tend always to hedge their bets & not take as much “risk” as a doctor going to med school then setting up a private practice...or a worker who moves across the country to take a promising job that might not pan out”
ELIMINATE the payroll tax AND the corporate income tax & replace them by a 20% VAT which would tax imports not exports & bring in trillions of dollars of offshore earnings plus trillions more in additional investment dollars to the USA. that is REAL tax reform & is REAL “supply side economics”. Under an un-steep tax code like the above one with 3 rates but not payroll taxes, a person earning $10 million annually would pay an effective income tax rate in the high 20% range, which is below the Laffer Curve.
anything that is “revenue neutral” will hurt small business & the professional class by hitting them with a steeper code & fewer deductions...& middle class workers in higher wage states take a hit, too.
do some real reform or don’t do it at all. reward WORK. my idea gets rid of 3 out of the 4 income taxes on the same work at the federal level & lowers the rate on what is left. it is real middle class reform that will be popular, whereas Trump’s idea will look like more of the same”. ——
(quoted from a friend’s rant/policy blog)
Does this make sense? (the person who wrote this blog about tax plans considers himself to be a Republican-leaning, pro-business independent who hated Hillary & Obama & liberalism in general.)
Sara Carter at Circa
25% top rate.
Better: 10% flat rate.
Best: Repeal 16th amendment.
The purpose of tax cuts should not be to “spark” or stimulate anything.
The purpose of tax cuts should be to not commit theft on quite so grand a scale.
Arthur, I agree with that.
We should not be taxing people as high as we do.
None the less, there’s nothing wrong with advocating it for a reason that people can’t refute.
If we approach this saying it isn’t right, what support do we get in Congress? If we approach it saying it will help the economy, our Congress critters are more likely to bite.
There’s this silly notion our leaders have, that as citizens we should be glad to pay ALL our income to the government. This avoids that argument.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.