But by structuring this benefit as a deduction – instead of as a tax credit – Trump has essentially crafted a welfare program that America’s neediest families can’taccess. By offering a tax deduction for childcare, Trump is proposing a child care plan that will absolutely miss the working families that need help the most.
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Mitt Romney was excoriated during the 2012 presidential campaign for paying $4.9 million in federal income tax, or an average of just 14 percent of his adjusted gross income, in the two years for which he released returns.
He also said that he meant to widen the difference between that new business tax rate and the top individual income tax rate by more than he had originally suggested – by reducing the latter from 39.6 percent to only 33 percent, rather than his previous proposal of 25 percent.
Today, Mr. Trump has proposed that the estate tax be eliminated.
The biggest problem with Trump’s tax reform is that it’s only an outline, albeit a good one, with less than 100 days until the election. The vision is right out of a movie set: “Let the poor and the middle class pay taxes; waiter, another round of cocktails please.”.
Repealing the Affordable Care Act, and the tax increases that it imposed (such as the 3.8% Medicare surtax on net investment income of higher-income individuals).
“American workers have paid taxes their whole life, they shouldn’t be taxed again when they die”, Trump declared. She would install a sliding scale of rates, with shorter-term investments taxed at higher rates than now.
In past writings, I have equated Trump’s tax-reduction plan to the John F. Kennedy and Ronald Reagan tax cuts, which generated economic booms of roughly 5 percent growth per year. It is nothing more than a reconstitution of the standard Republican trickle-down economics that have benefited big corporations and a wealthy few for more than a generation while leaving American workers – including quite a few cowboys – mired in economic stagnation.
One has to picture this group of billionaires lighting up cigars, sitting is a small literally smoke filled conference room and recommending to Mr. Trump that the federal estate tax should be eliminated. It’s estimated cost: $10 trillion over 10 years.
Trump’s latest tax proposal is proof of that.
Second, Trump proposed a tax deduction that would allow parents to subtract the average cost of childcare from their IRS bill.
No one I spoke to has seen Trump’s tax returns, because he has not released them. The Tax Policy Center found that in 2013, 20 small businesses and farms paid any estate tax nationwide.
Trump “has drunk the supply-side Kool-Aid”, said Sullivan.
The GOP nominee also moderated his broader tax-reform package, which initially called for reducing the top marginal rate on personal income to 25 percent. A pass-through business entity pays no taxes itself, but sends earnings onto its individual members, who pay income taxes depending on their tax bracket – at rates as high as 39.6 percent. This loophole allows Trump to claim that he is closing the carried interest loophole, while actually lowering the rate that hedge fund managers would pay from 23.8 percent to 15 percent.
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More than two-thirds of all such pass-through income flows to the top 1 percent of tax filers, according to the Center for Budget and Policy Priorities.
