TOWNHALL BREAKING NEWS: President Trump’s Tax Reform Plan Introduced, Here’s What You Need to Know

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President Trump’s Tax Reform Plan Introduced, Here’s What You Need to Know

TOWNHALL by Katie Pavlich

President Trump’s tax reform package was officially introduced Wednesday by Treasury Secretary Steve Mnuchin and National Economic Council Gary Cohn. The proposal is headed to Capitol Hill for consideration and the administration plans to meet with a number of stakeholders at the White House for listening sessions on the proposal.

“The President is determined to unleash economic growth for businesses. This is not just about big corporations,” Mnuchin said from the briefing room.

Here is what we know.

Objectives:

-Economic growth, getting to three percent GDP within the year after implementation

-Job creation

Personal/Individual tax reform:

-Repeals the Alternative Minimum Tax for individuals

-Eliminates the death tax

-Eliminates all tax deductions, excluding the mortgages and charitable deductions

-Zero tax rate for the first $24,000 a couple earns

-Three tax brackets (previously seven): 10, 25 and 35 percent

-Marriage penalty elimination

Business tax reform:

-Small, medium and large businesses qualify for the business rate

-Lowers business rate from 35 percent to 15 percent

-One-time tax on corporate earnings held overseas

-One time tax on overseas profits

-3.8 percent Obamacare tax on business investment income repealed

This is a developing story, stay tuned for more information.

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5 COMMENTS

  2. In regards to the alternative minimum tax is if the new and improved tax overhaul become the tax law of the land, state income taxes , property taxes, and local taxes such as our excise taxes on autos, will NOT be deductible. When computing the alternative mim tax, state and local taxes are not deductible. So, in essence, we all will start paying the alt min tax since those taxes will not be deductible in arriving at our ordinary taxable income. In addition, for those outside sales people who have to pay out of their pockets expenses that their employer will NOT reimburse, they will not be able to deduct those expenses. The notion that the alt min tax is a second computation for determining your income tax liability is ridiculous because all returns are computed via software and the computation is automatic. Believe me when I say that over the past 37 years of dealing with taxes and tax reform, if I had one dollar for every time I heard, ” let make the tax code simpler” I would have Millions!!!

  3. The theory of lower tax rate on Capital: A farmer had ten seed potatoes (Capital) which produced ten potatoes for every one seed potato (income) and each ten seed potatoes required four workers (labor) in essence the harvest produced one hundred potatoes employing four workers. Now, the farmer decides to sale the farm, and in the process, has to pay the capital gain of now 23.8% plus the Indiana tax of 4.4% or a total of 28.2%, Consequently, now we have only 7.18 seed potatoes (100% minus the effective tax rate of 28.3% = 71.8% or 7 seed potatoes remaining to produce the next crop). So, the next harvest will produce 71.8 potatoes, however, now the labor cost will be reduce by the same corresponding reduction or instead of 4 workers, we need only 2.9 worker or 3 rounded. In addition, if the income tax rate is effectively 30%, instead of income taxes before the capital gain taxes based on 100 potatoes which would be 30 potatoes, now after the reduction due to the cap gain taxes, the income taxes are only 21.5(71.8 potatoes x 30%) potatoes instead of 30) or a reduction in income taxes of 8.5 potatoes. However, the govt received 2.83 potatoes but gave up 8.5 potatoes in income taxes. As such, the govt is behind by 5.6 (8.5 less 2.83). But this is worst, this is only one year. The next crop after crop has the lower yield and employment is still only 3 instead of 4. In addition, the one individual who is without a job is on unemployment and not paying social security taxes and of course income taxes. IS THIS WAY IN GERMANY, THERE IS NO CAPITAL GAINS TAXES???? They have higher income taxes ..do you see the multiplier effect???

  4. what about the deficit nothing here about the deficit any plan that borrows more money increasing the debt is not good for business its just more borrowing more debt more deficits it has to stop does this do that

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