CUT MEDICAID AND SOCIAL SECURITY TO FINANCE TAX CUTS FOR THE SUPER RICH!
OBAMA-CLINTON-TRUMPERnomics: America’s Road to REVOLUTION
….. but will they finish off the
American middle-class first???
“The Tax Policy Center finds
that for the top 0.1 percent of income earners—those making more than $3.75
million annually—repealing this investment tax would amount to an average tax
cut of $165,090.”
Trump tax cuts: A bonanza for corporations and the wealthy
By Patrick Martin 27 April 2017
27 April 2017
The Trump administration is proposing the largest tax cut
for the wealthy in American history. The plan outlined on Wednesday would
transfer trillions of dollars from future tax collections into the pockets of
the super-rich. Its purpose is twofold: to enrich the financial aristocracy and
force the destruction of programs such as Social Security and Medicare by
depriving the federal government of the revenue needed to fund them.
Secretary of the Treasury Steven Mnuchin and Gary Cohn,
chairman of Trump’s National Economic Council, issued a one-page statement of
principles at a White House press conference Wednesday afternoon, where they
gave only a few highlights and took a handful of questions, which they largely
avoided answering.
The entire exercise seemed rushed. Press accounts suggest
that the tax plan was thrown together in haste in response to mounting
criticism from Wall Street, particularly in the wake of the abortive attempt to
repeal Obamacare, that the administration was failing to live up to its commitments
to carry out a major transfer of wealth from working people to the
multi-millionaires.
That said, the press conference Wednesday did give a glimpse
of the naked personal greed that is a major driving force of American
capitalist politics. Mnuchin and Cohn could scarcely control their excitement
over what Cohn called a “once in a generation opportunity” to transform the tax
code. The two former Goldman Sachs bankers, each worth more than half a billion
dollars, spelled out the main features of a plan that will add to their own
immense wealth.
Among the main measures that will benefit those in the
highest income brackets are:
* Abolishing the estate tax, so that the wealthy can pass on
their fortunes intact
* Abolishing the Alternative Minimum Tax (AMT), established
in response to widespread tax evasion by the wealthy
* Cutting the tax rate for business profits taken as
personal income (so-called “pass-through” income) from 39.6 percent to 15
percent
* Cutting the top income tax rate from 39.6 percent to 35
percent
* Ending the capital gains tax surcharge of 3.8 percent for
Obamacare
Many of these measures will benefit President Trump
personally, particularly the abolition of the AMT. According to Trump’s leaked
2005 partial tax return, he paid $38 million in income tax that year, rather
than $5 million, because of the AMT. He also takes much of his real estate
investment income in the form of “pass throughs,” for which the rate would be
cut by more than half.
Abolishing the estate tax, which currently applies only to
fortunes of $5 million or more, would allow Trump to pass on his billions to
his five children without them paying a penny. The same applies to Cohn (net
worth $610 million) and Mnuchin (net worth $500 million).
The tax bonanza for corporate America is even greater than
that for wealthy individuals. The biggest single proposed cut is the reduction
in the corporate income tax rate from 35 percent to 15 percent, at an estimated
cost of $2.4 trillion over the next ten years. In 2018 alone this action would
cut the tax bill for corporations from $340 billion to $125 billion, a direct
injection of $215 billion onto their bottom line. The bulk of those funds would
be returned to wealthy shareholders via stock buybacks and dividends.
Added to that is the proposed change in the taxation of
US-based global corporations through the establishment of a “territorial” tax
system, in which only income earned by the corporation within the United States
would be subject to corporate income tax. Given the ability of corporations to
manipulate the flow of income, there will be a renewed incentive to record
income in overseas tax havens rather than in the US, and thus escape taxation
altogether.
This would be coupled with a one-time incentive for
corporations to repatriate profits being held in offshore accounts. The rate at
which these profits are taxed could be set as low as 5 percent, a huge
boondoggle for a handful of corporations, including Apple and General Electric,
which are holding trillions of dollars overseas.
The business tax cuts are expected to win support from many
congressional Democrats, who will verbally oppose the reduction to a 15 percent
rate for corporate income, but trumpet a cut to 18 or 20 percent as an
acceptable “compromise” forced on Trump by their supposedly determined
resistance.
The Obama administration had previously proposed a reduction
in the corporate income tax rate from 35 percent to 28 percent, and 25 percent
for manufacturers—a windfall of “only” $100 billion a year—while Senate
Minority Leader Charles Schumer is the co-author of a bipartisan plan to
“incentivize” the repatriation of overseas profits through a tax holiday for
the corporations involved.
Ahead of Wednesday’s announcement, Schumer struck a pose of
opposition, declaring on the Senate floor, “That’s not tax reform… That’s just
a tax giveaway to the very, very wealthy that will explode the deficit.”
The last phrase is the key. Opposition from Democrats, and
some Republicans, will focus on the fiscal impact of the tax cuts. To the
extent that tax cuts are enacted—and they are virtually certain to pass in some
form—there will be bipartisan demands that the cost of the handout to the
wealthy be “paid for” through cuts in spending. These cuts will not be made in
the gargantuan Pentagon budget, which will be increased, but rather in
so-called entitlements such as Social Security, Medicare and Medicaid, the most
expensive domestic social programs.
This perspective was spelled out by
the Washington Post in an editorial published on the eve of
the tax plan’s release, bemoaning the effect of the tax cuts on the federal
deficit without mentioning the issue of economic inequality and the plundering
of the country for the benefit of the super-rich. The editorial concluded, “For
eight years, Republicans mercilessly attacked President Barack Obama for doing
too little to cut federal deficits. Will they really turn around now and
approve a budget-busting tax cut?”
The tax plan outlined Wednesday includes a number of
provisions that will affect middle-income taxpayers, both positively and
negatively. The net result cannot be seriously calculated because so many
details remain undetermined.
Cohn said the White House is proposing to double the
standard income tax deduction to $24,000 for a married couple. This would be
offset by the elimination of the tax deduction for employer-paid health
insurance and for payment of state and local taxes.
Lower income workers would gain nothing from the increased
standard deduction, since they generally pay little or nothing in income taxes
and are far more affected by payroll taxes for Medicare and Social Security,
which would be unchanged under the Trump plan.
Cohn and Mnuchin described the tax plan outlined Wednesday
as an “opening bid,” preparatory to lengthy negotiations between the White
House and Congress. There are two possible legislative tracks—a bipartisan
deal, which would require the support of at least eight Senate Democrats to
overcome any filibuster, or passage under a procedure known as “reconciliation,”
which requires only a simple majority but limits the duration of the tax cuts
to a ten-year period.
AMERICA STUDENTS STARVE:
Report on the impact of
OBAMA-CLINTONOMICS-TRUMPERNOMICS
THE
SWAMP DWELLERS:
GLOBAL
LOOTING of the POOR
TRUMP
and FAMILY, BILL, HILLARY & CHELSEA
CLINTON, MICHELLE AND “HOPE &
CHANGE”
PSYCHOPATH MUSLIM BARACK OBAMA!
Will
they finish off America as they serve themselves and the super rich???
THE IMPACT OF TRUMPERnomics
AND THE MASSIVE
TRANSFER OF WEALTH TO
THE SUPER RICH
AMERICA: One paycheck
and two illegals away from homelessness.
"The economists found that the pre-tax share of
national income received by the
bottom half of the US population has been cut nearly
in half since 1980, from 20
percent to 12 percent, while the income share of the
top one percent has nearly
doubled, from 12 percent to 20 percent."
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