Proposal would boost long-run GDP by 9.1 percent, increase wages by 7.7 percent
The House Republican tax reform plan introduced by Speaker Paul Ryan (R., Wis.) would create 1.7 million jobs, increase the nation’s GDP, and increase after-tax income for all Americans, according to an analysis from the Tax Foundation.
The plan would simplify the tax code so that it could fit on a postcard, and lowers marginal tax rates on wage, investment, and business income. It also broadens the tax base, lowers the corporate income tax rate to 20 percent, and eliminates federal estate and gift taxes.
“Our analysis finds that the House Republican tax plan would reduce federal tax revenue by $2.4 trillion over the next decade,” the report states. “We estimate that the plan would boost long-run GDP by 9.1 percent. The larger economy would translate into 7.7 percent higher wages and result in 1.7 million more full-time equivalent jobs. Due to the larger economy and the broader tax base, the plan would reduce revenue on a dynamic basis by $191 over the next decade.”
The proposal would broaden the tax base by eliminating all itemized deductions except the mortgage interest deduction and the charitable deduction, which would raise $2.3 trillion over the next decade. The plan would also eliminate most individual credits except the Earned Income Tax Credit, the American Opportunity Tax Credit and the Child Tax Credit, which would raise $104 billion over the next decade.
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7 comments:
1.7 million jobs for illegals!
Supply side economics just doesn't work. To build supply, there must be a demand. Handing money to the supply side (tax breaks) only serves to make the corporations wealthier. Without customers (demand) there will be no increase in jobs.
Trickle down hasn't worked yet. How about a new idea instead of breaks for the wealthy?
Might be a good plan. Wealthy own businesses. They hire new employees, when they feel like they can expand. Current administration does Nothing but Chokes the business by regulations and high taxation. And constantly bashing wealthy, pitting rich against poor. Just remember, nobody ever got offered job and got paid by poor folk. I see this plan going in right direction, but Trump Plan is better.
TRUMP TRAIN 2016
9:34 AM - "They hire new employees, when they feel like they can expand."
No. Econ 101. Businesses hire new employees when there are a greater number of customers. Without customers, there is no need for production.
If you really want to grow business, make sure that there are plenty of customers with disposable income.
Throwing tax breaks at businesses never creates jobs.
(I am a business owner).
9:34 trying to bring Reagan back from the dead? Didn't work then and won't work now.
Yes,Of course, first there has to be demand by customers. Secondly, then they will decide if they want to hire new employees. My point is that With current administration, most businesses can barely break even, so why even bother to hire new employees. Besides, government idea of raising minimum wage to $15/hour is deterring from new hiring. It's already happening in Seattle, where the robots replaced the workers at McDonalds drive throughs. Wellcome to Obama-Clinton Economics.
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