About 95 percent of businesses in the United States are structured as pass-throughs, and they account for most of the corporate tax revenue paid to the government. Businesses would be allowed to deduct the full cost of new equipment in the first year rather than spread it out over time.
For individual taxpayers, the plan would collapse the tax brackets to three from seven, lowering rates for many while doubling the standard deduction and increasing the child tax credit. It would eliminate the tax on estates larger than $5.49 million for individuals and about $11 million for couples, while canceling the alternative minimum tax, which is meant to ensure that the wealthiest still pay but has increasingly affected middle-class taxpayers as well. To offset some of the cost, it would cancel deductions for state and local income taxes.
Mr. Trump said the net effect would be “a giant, beautiful, massive — the biggest ever in our country — tax cut” and called on business to press Congress to pass it. “With your help and your voice, we will bring back our jobs, we will bring back our wealth, and for every citizen across this land we will bring back our great American dream,” Mr. Trump told the audience of manufacturing executives gathered at a Washington hotel.
As he has done before, Mr. Trump exaggerated the economic progress made on his watch. He noted correctly that economic growth reached 3.1 percent in the second quarter of the year, but then asserted that America had not seen such growth in “a very, very long time.” In fact, the economy was growing that fast as recently as the start of 2015 and, since 2009, every year but one saw at least one quarter with even higher growth.
But in addressing the manufacturers association, Mr. Trump was preaching to the choir. The group said a survey of its members found that most reported that a package of tax cuts would make them more likely to expand their business, hire more workers and increase wages and benefits. The group’s survey found that over the past nine months, 91 percent felt optimistic about the outlook for their businesses, the highest three-quarter average in its 20-year history.
“Today’s tax code lets other countries win, and our workers and our families are paying the price and we have an obligation to speak out,” said Jay Timmons, the association’s president. “It’s time to go big, it’s time to go bold — and manufacturers are grateful to have a president who agrees.”
Continue reading the main storySource: New York Times – Politics