Trump tax plan explained

On Monday, Republican Presidential candidate Donald Trump unvieled his tax plan from Trump Tower in Manhattan, New York. The Trump tax plan offers tax cuts across the board, with the biggest cuts going to the rich.

Donald Trump claims that he “did the plan with some of the leading scholars and economists and tax experts that there are in this country,” but failed to name exactly who those economists were.

Trump also claims to be leading in the polls amongst Republican voters on issues concerning the economy, which he claims proves that he should be entrusted with it.

The plan involves major tax cuts across the board.

Individuals making less than $25, 000 a year and couples making less than $50, 000 exempt from income tax.

Trump claims that he would pay for this plan by closing tax-loopholes, although he did not specify which.

“It reduces or eliminates most of the deductions and loopholes available to special interests and to the very rich. In other words, it’s going to cost me a fortune,” said Trump.

However, Trump definitely did not forget about the richest Americans and his plan helps them out far more than it does anyone else.

Trump’s plan would decrease the top income tax bracket from 39.6 percent to 25 percent.

Additionally and significantly he would completely repeal the estate tax for inheritance over $5.4 million. Meaning that men like Trump could pass on their estate completely tax free.

While Trump’s push for no income tax for the poorest Americans seems very generous to the less fortunate, and tough on the rich, which is what Trump claims, when you break it down, the opposite is true.

The bottom quintile of Americans pay the least in federal income tax as it is, and that tax makes up a small percent of their tax burden. They still have to pay the same in state and local taxes.

So for the poor, it is a small tax break.

Meanwhile, the richest Americans pay the most in income tax, so a 14.6 percent cut in their income tax is a huge favor and eliminating the estate tax is a big give away for the rich.

The Trump tax plan will cost the country trillions.

 

[The Associated Press via Yahoo News] [Reuters] [The LA Times] [Citizens for Tax Justice] [The Tax Policy Center]