Tuesday, September 29, 2015

Donald Trump's Tax Plan - Playing To Socialists & Creating Jobs

Donald Trump, who to date has been heavy on bluster and light on policy, issued his Federal Income Tax Plan.  Clearly, as this Blogger has contended all along, Trump is attempting to build a New Coalition that will appeal to Socialists, Independents and Republicans.  Trump's Tax Plan does exactly that.  What Trump is promoting would absolutely create millions of good paying jobs in the United States.   We would see dramatic economic growth if this plan was enacted into law.

As part of the Plan, Trump wants to increase the number of Americans that pay no income taxes at all from the current 46% to around 50% of working Americans.  These would be the 75 million Americans often referred to as the working poor.  While in general, this Blogger believes that everyone should have to pay something, even if very little, it is true that these Americans; singles making less than $25,000 and married couples earning less than $50,000 have very little disposable income.  All of their income is going to pay for basic necessities like food, housing, utilities etc; even though many of them also qualify for the Earned Income Tax Credit, (monies paid them by the Federal Government to encourage work rather than taking Welfare), Food Stamps and ObamaCare subsidies, if they are not getting health insurance from their employers.   So, in most cases, the Makers in society are providing government benefits to the Takers as part of the general redistribution of income Schemes that exist in all democracies.  Trump does not change that positioning with his Tax Plan.

Next, Trump wants to cut current income taxes for everybody else by implementing three tax brackets; 10%, 20% and 25%.  Americans earning under $150,000 a year would pay the lower percentages; while those earning over $150,000 would pay 25% on all income above this amount.   This would be a good tax cut for the Middle Class and a great tax cut for the rich who now pay 40% and more with the ObamaCare surcharges.  To pay for these tax cuts, Trumps would limit, or eliminate certain loopholes, while maintaining the Mortgage and Charitable Gift Deductions.  And, presumably rather than pay Capital Gains on investment income of about 28%, most investment income would just be taxed at regular personal income tax rates.

What is really good is that Trump cuts the Corporate Federal Income Tax from 35%, among the highest in the world, to 15%.   And, Trump wants to tax repatriated foreign profits at 10%, which would result in about three trillion dollars, that is sitting overseas, coming back to the United States almost immediately.   This change would create millions of jobs in the United States, as both US and foreign companies would build new manufacturing plants in the US, rather than overseas.  Further, many jobs that are now overseas would come home because there would be little advantage to shifting work to other countries.

Finally, Trump want to get rid of the hated Death Inheritance Tax, which hurts many family businesses and the Alternative Minimum Tax.  Trump also says that he favors Universal Health Care for all Americans, which means that he supports ObamaCare, one way or another, which essentially is supposed to provide health care for all Americans.   Trump says that he doesn't care if this cost him votes; but he knows very well that it will gain him votes from Socialists and Independents.  Republican voters will tolerate this position if Trump makes this Tax Plan reality. 

There is no doubt that Trump's Tax Plan would be advantageous to all Americans.  Of course, the Socialist will attack the Plan saying that the rich are not paying their "fair share", which is ridiculous, when under Trump's Plan 50% of Americans would pay no income taxes at all.  The rich would still be paying the majority of income taxes in the United States.  This is a great Tax Plan that would create millions of jobs and additional government revenues that comes with economic growth.  As long as the additional tax revenues are used to pay down the National Debt, rather than on new Federal Government Spending to buy votes, score one for Donald Trump 

No comments:

Post a Comment