The rich still eats caviar and the poor bread crumbs.
Donald Trump has finally put his tax reform proposal on the table within the context of what he would probably describe as the “mother of all tax reforms.”
The impression being given is that his tax reform would shake even the very foundation of the Republican Party.
Indeed, politics doesn’t only make men say anything to win power, but also make strange bed fellows.
According to Trump, his reform would reduce personal income-tax rates across the board, cutting the top marginal rate to just 25 percent from the current 39.6 percent and moreover, cut the top capital gains rate to 20 percent, from today’s 23.8 percent.
He would also reduce corporate taxes to 15 percent from their top current statutory rate of 35 percent and eliminate the estate tax.
The fact is Trump is a salesman extraordinaire. He didn’t accumulate his huge wealth without the gift of gabs. He is a show man and his utterances must be weighed carefully as too that of all politicians.
The prostitution of oneself to the electorate is not new; neither did it start with the current crop of presidential candidates.
Trump is apparently not only throwing out the baby with the bath water, but also throwing away the bath tub in order to do some electorate bootlicking to win votes.
First of all, Trump claims that his tax proposal is one that is “revenue neutral;” however, tax experts compare this to making bread out of stone.
Given the generous tax cuts Trump is proposing, one could easily dub the offer “Trump’s Election Grand Bonanza Giveaway.”
One finds it very difficult to see how Trump would pay for the giveaways without sinking the country into massive debt — an anathema to the Republican Party.
According to the Tax Foundation, Trump’s plan would cut taxes by $11.98 trillion over the next decade on a static basis. However, the plan would end up reducing tax revenues by $10.14 trillion over the next decade when accounting for economic growth from increases in the supply of labor and capital.
It also noted that the plan would result in increased outlays due to higher interest on the debt, creating a ten-year deficit somewhat larger than the estimates above.
The Donald may have good intention in his tax plan offering, but Tax Foundation has rightly noted, “he has failed to provide evidence that he can keep his promise to cut taxes at the level he has proposed and raise enough new revenue elsewhere to make his plan revenue neutral.”
So, a word of warning to the electorate — do not buy puss in bag!
Davy Desmond, Readers Bureau, Fellow
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