Hilltop Views

GOP Tax bill will hurt families, benefit the wealthy

Hang on for a minute...we're trying to find some more stories you might like.

Email This Story

A couple of weeks ago, I wrote about how the new Trumpian tax plan will hurt the majority of Americans while providing massive benefits to the wealthy and corporations. As the Republican party gears up to pass this new bill and have it on the Resolute Desk by Christmas, I think it’s worth taking a closer look at just how poorly this new tax code will work for the country.

Perhaps the biggest change to the tax code that would occur under the new GOP bill, the Tax Cut and Jobs Act, would be the reduction of the corporate tax rate. Republicans, predating the Trump era by many years, have long called for this reform. They claim that reducing corporate taxes will allow those businesses to retain more money that can be utilized to create jobs and lift wages, two things that basically every American can get behind.

However, these promises are about as likely to come to fruition as President Trump becoming the next Chairman of the NAACP.

First, Republicans never provide a time frame for when citizens will see these benefits. In all likelihood, as Paul Krugman explains, they won’t see wages rise for years and, when they do, it will only be by a marginal amount. The majority of the benefits would go to shareholders and investors.

In fact, about 35 percent of the investors that would gain wealth from this plan would be foreign, according to Steven Rosenthal of the Tax Policy Center.

The reason that this promise of job creation and wage increases is a lie is that, when companies gain profit through a reduction in their effective tax rate, this doesn’t translate into increased capital inflows from foreign investors or even a significant incentive to increase productivity.

All of this is compounded by the fact that, as I pointed out last time around, a majority of Americans do not support this change.

Furthermore, the tax bill seeks to eliminate several taxes on the upper class. The estate tax, which provides tax revenue when the owner of a large estate or company dies (hence the derisive Republican rallying cry against the “death tax”), will be significantly crippled for six years and then repealed altogether. Republicans often claim that this tax hurts small-time farmers and business owners, despite the existence of literally no evidence that supports their lies.

It also eliminates the alternative minimum tax; the set amount that wealthy individuals must pay despite deductions. This tax constituted the majority of the taxes Trump himself paid in 2005, according to a leaked tax return document. Every taxpayer in America plays the system to an extent; the complicated nature of the tax code and the incredible amount of loopholes invite and encourage this type of behavior. However, when someone as wealthy as Trump rails against paying even a minimum amount of taxes to the country they claim to love, it’s hard to get behind that kind of phony patriotism.

There are several other problems and deceits within this bill, issues that space will not allow me to examine. However, considering that the most conservative estimates admit this bill will raise the federal deficit by over a trillion dollars over ten years, it’s difficult to see this bill for anything other than what it is: a ridiculous, corrupt, gift to the wealthy and a crippling blow to the United States.

Leave a Comment

If you want a picture to show with your comment, go get a gravatar.

Hang on for a minute...we're trying to find some more stories you might like.

Email This Story

The Student News Site of St. Edward's University
GOP Tax bill will hurt families, benefit the wealthy