Republicans made two central promises. First that the bill would simplify the U.S. tax code. The second, it would primarily benefit working class Americans and the middle class.
The first proved false. There are nearly every large tax break in place. It’s put’s in place as many preferences as it get’s rid of. It’s enough to keep every corporate accountant busy for years to come.
The slant towards upper-income earners and people that run corporations is great, and the losers are the average tax payers says an expert the University at California, Berkeley.
Don’t fool people by saying it’s tax reform. It’s not. It’s a tax cut for businesses with some contradictory stuff for individuals. It’s biggest change is cutting the corporate tax rate from 35% to 21%. Unlike the corporate tax rate which is permanent, the individual tax rate expires in 8 years. People making under 250,000 will eventually get a tax increase and families making less than 75,000 will also get a tax increase but even sooner.
The biggest winners are Corporate America. In other words it’s another test for trickle down economics. Comparable to the Reagan era economic policy that many experts now consider a flawed theory.
Most economic forecasts predict the new tax laws will increase the GDP only marginally-by just 1.7% in the long-term, well below the aspirational 3% touted by Trump in recent months according to the Tax foundation.