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The new Republic tax bill has been released, and it doesn't look particularly helpful. To start, this bill lowers income taxes for all tax brackets, which sounds pretty good. However, there will only be four tax brackets as opposed to seven, and the tax cut is significantly bigger for the highest bracket compared to the lower ones. Based on public opinion, cutting taxes for the wealthy has been a particularly unpopular decision (at least it seems to be), so it doesn't seem like a good political move to have that as a part of the bill. According to two polls, Americans have mixed feelings about whether or not the bill would improve the economy, and the majority anticipate a large dent in the budget deficit. Moreover, even with the all-around tax deduction, this will still be a huge problem for those that used to be in a lower bracket that will be moved into a higher one under this bill.
It is true that this bill cuts the income tax for all brackets, so some might say something is better than nothing. But of course, we know that money doesn't grow on trees. The money to make up for this has to come from somewhere, and that somewhere would be repeals to many tax deductions including those on student loans, medical bills, mortgages, alimony, and several others. All these repeals still aren't enough to cover the whole thing though, so there will indeed be a large dent in the budget deficit.
This bill doesn't seem economically healthy, and also doesn't seem like a good political move on part of the GOP. Perhaps I have overlooked something, or maybe you hold a different stance on the bill?
18 comments:
It looks like the Republicans are trying to reinstate the Reaganomics policy of the 1980s, which focused upon massive reduction of taxes. Unfortunately, such policies also resulted in the greatest budget deficits in American history. Recently in AP Government class we have discussed the political stances of several political parties. The Republican party is consistently known for advocating a restriction in the scope of government. Clearly, a GOP-controlled tax cut on the American population aligns with the philosophy of Republican politics. The author mentions that this bill does not appear "economically healthy", and many liberal politicians would agree with that stance. I personally would like to know more about why the decision was made to switch from seven to four tax brackets.
Ever since the glory days of Reagan in the 1980s, Republicans have been trying to replicate the economic success it had back then. Their answer is to cut taxes on the rich and the middle in order to boost economic production by having more spending towards economic goods, thus creating new jobs and opportunities for Americans. It worked back in the 1980s, but I doubt it will work now, considering the mixed results of the Bush tax cuts (ahem, 2008). I view this as a political move done by the Republicans to prove to Americans that it can actually do stuff in Congress, but the effect of the bill is yet to be seen and its effect on the economy will be the ultimate decider on whether Americans, especially those of the "heartland states," support the Republicans.
It seems that the top 1% seem to benefit the most from this new tax bill. Additionally, I think that lowering household taxes but repealing other tax deductions and potentially affecting the deficit is not a beneficial exchange, and looking for other options before making a big decision is more appropriate. This bill also proves to affect Trump's popularity and approval ratings. Through recent polls from NBC regarding public sentiment of the new bill, 75% are against the bill. Furthermore, polling from CBS shows that most Americans don't believe that cutting tax should not be a priority for the government. I think that other options are available and more suitable for the people and the president.
When it comes to lowering income taxes, I hold some pretty liberal views, so my opinion might be biased, but I strongly believe that the top tax bracket should definitely not receive the largest tax cuts. I understand how tax cuts could be good and benefit lower tax brackets, but the top tax bracket does not need the tax cuts. For some family, it is a matter of basic needs, low income families can't give a lot of money to the government because they need to feed their families, but for the wealthy people in our nation, even if they have to pay more taxes, they will definitely still have enough money to feed their families, live comfortably, and still have extra money to spend how they choose. Because of this, I don't agree with the republicans' new tax plan.
I personally am against this bill because it has a greater potential of negatively affecting the people. Many of the middle-class people would have to pay a higher tax rate than before. Furthermore, taxpayers will no longer be allowed to deduct state and city income taxes from their federal bill. Doesn't that just suck, especially living in California where the state tax is extremely high.
From what I can see, the biggest tax cut have been made to the people with the highest income which makes no sense to me. Personally I think it should be the other way around and the top 1% should have the lowest tax cuts, the proposal seems it will make the middle class pay really high taxes which again seems extremely unfair to me. I might be biased as having a liberal point of view on tax reforms but this still seems unreasonable to me in a lot of ways.
Nope, you got it pretty spot on. Most Republicans trying to push this bill through are quite rich, and therefore would benefit from lower taxes for the rich. This is but another way money has ruined politics. Those with money control the government, or can control it though lobbying and donating. With this power, they make it so they can get more money, and those without can only wait and suffer. This bill would be fine if the government stopped spending so much on the military. In a modern world there is less need for a string military force, and a greater need for a surveillance presence and knowledge database. Therefore I think tax cuts like this could work with a proper budget balancing. But overall, this seems to be a bill written by the rich to benefit the rich.
I am also very interested in how they decided to cut down the tax brackets from 7 to 4. I should think this decision would also receive disapproval, as it broadens the range for an individual that can make a difference of a few percentage points and a few thousand dollars. I also completely agree what was stated above. Tax reductions for all is in essence something everyone would want, but that would mean the government gets less money to pay for the many programs we have. The richest are benefiting the most from this decision. It is a fact that everyone is going to have to pay taxes if we want to enjoy the programs we have today, and sacrifices must be made. I believe the people with the best ability to provide should be taxed as such. In this way, I do not support this new Republican tax bill.
This bill seems inefficient and unnecessary. The taxes we have now, though not perfect, are far better than the taxes proposed by this bill. Taxation is the federal government's biggest source of funding for its budget. If the goal of the bill was to relieve financial pressure on the people, why not only cut the taxes for those most burdened by them (i.e. lower to middle class)? Is a tax cut really necessary for people who have more money than they can reasonably spend? Or, better yet, instead of cutting taxes, redirect those funds towards programs that help relieve financial stress (i.e. health care, higher education, employment assistance, etc.)? Considering much of our budget is, in my opinion, wasted overseas on wars like in Iraq or Afghanistan where nobody wins, especially the innocent men, women, and children we consider "collateral damage," why not redirect that money towards actually helping the disparaged and distraught? Those hundreds of billions of dollars could be spent funding health care or higher education for those who can't afford it, which, in my opinion, are two significantly better investments since a healthier and smarter population leads to more higher paying jobs and a higher GDP. So much for the people who claim to be so worried about the budget deficit and inefficient spending.
Also, Justin, would you care to elaborate on the "glory days" of Reagan? I'm not sure about what the short term effects of his tax cuts were but the long term effects, from what I gather, seemed to be pretty negative and outweighed short term positive effects. More information and data on the subject would be much appreciated.
I don't see the logic in having richer people pay a higher share of taxes. If all the rates are even, richer people will be paying more anyway. I know this may seem like a lack of empathy for the poor or a dismissal of their worries, but to me a higher tax rate also devalues the earning of the rich, especially for people who paid their share while poor just to lose more and more money as they move up. Why try to be rich if it only means being taxed more? I can't blame businesses for moving property overseas and trying to avoid taxes because they are taxed more than other people, and I can see why that seems unfair. I think the U.S. has an issue of equity vs. equality in many areas, and this is one. Equity can be seen as the punishing of those who have made efforts and reached success while those who haven't are given a sense of entitlement.
I think that the rich should not be punished for being successful. Most people who are very wealthy have worked very hard and provided a very valuable good or service that has benefited many people despite what many hear about the rich "exploiting" the poor. Why should their success lead them to have to pay a higher rate of taxes. I believe that this makes sense to a certain point in that the rich can afford to lose more of their money but I think that the idea that the hard working rich should be paying for lazy people's welfare checks is ridiculous. I think that the government should be far less involved in social welfare programs and trying to help the less fortunate because you cannot spoonfeed success to people because that completely takes away their motive to work hard and to make a life for themselves. According to the Brookings Institute, only 2% of people who graduated high school, got a full time job and waited till marriage to have kids ended up in poverty and 75% of these people ended up in the middle class. The idea that it is so hard for people to make it in the US because of "white privilage" or "corporate greed" and it is the government's job to make up for this is a complete waste of resources because the truth is that as long as if you make good decisions and work hard in America you will be just fine. I don't see why anybody would object to paying less taxes because who wants the government to be taking more of our money and as one that believes in limited government and individual responsibility I think there are plenty of things the US can cut back on in terms of government spending.
The only issue I see with Trump's tax plan is the removal of many tax deductions. It is true that this is the most likely way the government would compensate for the drop in revenue from taxes. However, as a whole, I believe that the cut in taxes for everyone, especially the rich, is fair. I don't believe that it is fair that part of the population should lose more than half of their earnings to taxes, even if they do make more money. I think that the fairest way to go would be a flat tax rate for all American citizens. That way, everyone would be contributing their fair share, and richer people would not be penalized just for making more. It would also be fair because more financially secure citizens would still be paying more in taxes.
While I agree with the author that the new bill doesn't seem particularly helpful, I think some policies are very difficult to create a solution for in which everyone will be appeased. However, I think the upper and upper middle classes will like these tax deductions, but the lower classes stand more to lose. Taxes are a crucial part of how our country operates and I think they should be proportional to amount of income someone makes, as I don't think it would be fair to tax white collar workers and blue collar workers the same amount.
I agree and believe that this tax cut is not the greatest thing for the American people. While this may benefit those who are wealthy and successful, it comes at the expense of the poor. The rich have more to give and therefore should be mandated to give more. My ideas are liberal and therefore biased but it seems reasonable.
This bill, just seems like the rich republicans in control of government are continuing to try to get richer. The rich want tax breaks, because usually they are paying the bulk of american taxes; and since just lowering taxes on themselves would seem sketchy and wrong to the general public, resting large tax cuts on the rich under a larger umbrella of "everyone in America gets tax cuts" which is basically political eye candy, they can get away with it. Additionally their tax plan is an overall bad idea, and due to the fact that they will be taking away from things like student loans and mortgages, people will likely suffer from these so called "tax cuts". Furthermore, we will be putting the government deeper into debt, and only deteriorating society as a whole.
Getting rid of taxes is what every moneymaker wants to a certain extent. No one wants to have their hard earned money taken away by strangers they only heard of on the news. On an objective view, tax reduction would cause even greater debt in the government, potentially causing the government to lose the ability to do some actions due to the loss of money. Also, the loss of tax deductions will detriment millions of students and workers alike as tax deductions help many struggling people in America.
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