New York – After vowing to increase taxes on high-income earners and hedge fund guys, Republican Presidential candidate Donald Trump introduced a tax plan that would reduce tax rates across the board and lower the amount paid by rich corporations and Americans to the U.S. Treasury.
Trump stated that the new tax plan would offer considerable tax relief to middle-income Americans and will simplify the existing tax code. It will help nation’s economy reach at a new level. However, experts believe that the plan appears to have a price tag that can increase the national debt.
The plan Trump introduced proposes reducing income taxes for millions of married couples with earnings below $50,000 a year and single U.S. residents earning below $25,000. Individuals would get a form to send the IRS stating they win.
Richer Americans would witness large reductions in their yearly tax bill. Under the new four-bracket tax plan, the highest marginal tax rate is reduced to 25% from 39.6%.
Businesses would find their tax rates reduced to 15%, down from the existing tax rate of 35%. Trump stated that he would remove the estate tax. He intends to compensate for the tax cuts by reducing and eliminating unspecified loopholes and deductions, both on the corporations and very rich Americans. Also, Trump wants to reduce the carried interest loophole that enables private equity firms and hedge funds managers to pay a lower tax rate compared to individuals.
Tax experts believe that the company may face increased costs due to the new tax plan. They rejected the analysis given by Republican Trump. A tax and accounting Professor said that his calculation revealed that as a group, the U.S. residents earning over $200,000 annually would pay less in taxes. Other resident scholar said that the proposed tax program is not a serious plan.
In fact, the plan can cost over $7 trillion in the coming decade. Clearly, the proposed tax cut plan is much bigger compared to the previous proposed plans from Republican candidates.