In spite of what the president is saying, the GOP tax reform plan is not meant to help you and me. It is meant instead to provide corporations and the ultra-wealthy with tax breaks. The bill would permanently lower the corporate tax rate from 35 percent to 20 percent. It would also gradually phase out the estate tax by 2024, which only applies to estates with greater than $5.6 million in assets, and it would eliminate the alternative minimum tax (AMT) immediately (the AMT is s a supplemental income tax imposed by the United States federal government required in addition to baseline income tax for certain individuals, corporations, estates, and trusts that have exemptions or special circumstances allowing for lower payments of standard income tax). The AMT applies to people who make more than $130,000 a year. This plan offers nothing to the bottom 35 percent of Americans. In addition, it will increase the deficit by an estimated $1.5 trillion dollars over the next decade, according to a study by the Wharton School at the University of Pennsylvania.
How will this plan affect the average working-class citizen? To help pay for these tax cuts for the rich, the GOP plans to eliminate tax deductions that presently offer relief to the middle-class. This includes deductions for student loan interest, adoption costs, moving expenses, alimony payments and extremely high medical costs. It eliminates exemptions for dependent children and personal exemptions. It does increase the standard deduction some, however, to help make up for elimination of itemized deductions.
Trump and the GOP claim that their tax plan will cut taxes for middle class. But how will any of the proposed plan’s components help to cut taxes for middle class? Let’s look at the bigger picture. If you consider just the alternative minimum tax (AMT), President Trump paid an additional $31 million in taxes solely because of the AMT in 2005. So who really benefits from the call to immediately eliminate the AMT? How can we trust the president and his wealthy GOP colleagues to reform taxes for all Americans when they clearly benefit from their proposals?? What does Senator Heller have to gain? How can we trust Trump’s tax plan when he refuses to disclose his own tax records?
Cindy Fox
Virgin Valley Action Group
Ms. Fox Unfortunately you don’t know what your talking about. The number one thing we don’t have a final tax plan. But to address your statements, you state that the plan has nothing for the lower 35% but how about doubling the exemptions and lowering the tax rate? Next corporations don’t pay taxes they just collect the tax from you and me or lower their spending. How about our 401k plans that own stock, I’m not a fat cat, but my 401k is important to me. What about doubling the number who earn money but will be exempt from tax? The AMT will be largely nothing because of the lose of deductions that were requiring the AMT. If you have student loan interest, adoption costs, moving expenses or alimony payments, I should not have to pick the slack created by your expenditures. But wait lets see what the final bill looks like before you turn loose the attack dogs or are they already out?
I do not agree with either of the tax plans proposed by congress, because they do not represent any real reform of our overly complex, unfair and burdensome tax system. I will not respond directly to much of what Ms. Fox has written, as there is no logic there to refute. It is important to note, as has Mr. Young, that corporations don’t pay taxes – they pass the tax along to customers, or if that isn’t possible, they cut costs (wages, benefits, jobs) to overcome the tax burden. Our corporate rates are among the world’s highest and must be lowered to make US businesses competitive in the global economy. Offshoring jobs and taxes being paid to other countries are the result of ridiculously high corporate tax rates. Cutting corporate rates is logical for all Americans, and not because one supports those “evil” corporations, or that politicians are bought off by companies (as is generally alleged).
Only people that want someone else to pay for all government services should like the reprehensible “progressive” (how I have come to loathe that word) tax system that we have in this country. Why should tax rates increase according to income, when actual dollars paid already increases for a given percentage as income increases? A flat tax of around 10% (no deductions of any kind) is the only logical, and fair, way for all to have a vested interest in the cost, size and reach of our federal government. The “progressive” system is income redistribution plain and simple, and never was intended to be “fair” in any sense of the word. Who can you give tax breaks to, except for those that are already paying the tax burden in this country. Our government must cut costs, and there is plenty of fat, corruption, fraud and waste (including numerous inane and asinine programs) to cut. Let’s review the facts of who pays taxes and how much. (National Taxpayers Union Foundation for tax year 2015):
The top 1% of earners paid over 39% of all income taxes. So, the truly rich are paying an outsized portion of the cost of government – which is what people say they want (“make the rich pay for it”).
The top 5% paid almost 60% of all income taxes. Read it again – 5% of earners paid 60% of the taxes!
The top 10% paid over 70% of all income taxes.
The top 25% paid over 86% of all income taxes.
The top 50% of earners paid over 97% of all income taxes
The bottom 50% of earners paid less than 3% of all income taxes.
Again, who can you give tax breaks to except those paying the taxes. Ms. Fox laments that there is nothing for the bottom 35% in the proposed tax plans – well, they pay no taxes, so how can you give them tax breaks? According to leftists (socialists), you give them more of someone else’s money – more income redistribution. That’s what the railing against tax reform is all about: “you have money, so give it to the government to spread around.” This is already happening to a very great extent, as you can see in the numbers above. If many people (roughly 50%) are not paying for government “services”, then they have no interest in seeing government costs brought under control. Anyone that doesn’t think that $20 trillion in debt, and a deficit of $93 billion per month (October 2017), means that our government has a spending problem and is out of control is seriously delusional. This means that both major parties and essentially all of our “public servants” (this would be laughable if not such a disastrous situation) are complicit in bankrupting this country. The current tax system is already unfair, but not in the way the leftists (socialists) portray it. The answer cannot be “make the rich pay for it all” and further increasing the burden on those already paying the bulk of the taxes. Taxes cannot be increased enough to solve the government’s spending problem – and where is the “fairness” in attempting to do so (again and again). It used to be that most people wanted to be “the rich” someday, and were willing to work toward becoming so. Now, the promises of every increasing government largesse, primarily by Democrats buying votes with taxpayer money, have created a different mindset: give up on the American dream, and let the government take care of you (by taking from the “rich” and spreading more of it around).
The current proposals offer no real reform of the tax code, and are simply lame attempts by an inept and incapacitated congress to try and show that they are “doing something.” Unfortunately, these attempts at “tax reform” (a misnomer for sure) are nothing of the sort.
The new Tax code lowers all federal income tax brackets and doubles the standard deductions. lowering income taxes for all.