President Donald Trump is defending the Republicans’ tax cut plan, pushing back against criticism that it will benefit the wealthy more than the middle class.
Speaking to reporters at the White House Saturday before leaving for Camp David, Trump said the middle class will benefit because the tax cut will draw companies back from overseas, creating jobs.
The GOP plans to muscle the bill through Congress next week.
President Donald Trump talks with reporters as he departs from the South Lawn of the White House via Marine One in Washington, Saturday, Dec. 16, 2017
Trump touted the nation’s economy, predicting that it would ‘start to rock’ once the bill is passed.
Trump also predicted that economic growth could go from the current 3 percent to ‘4, 5 and maybe even 6 percent ultimately.’
Many economists doubt that even a sustained 4 percent growth rate is achievable.
Republicans seem to have secured the votes to pass a tax overhaul that Trump hopes to sign before Christmas.
‘This is happening. Tax reform under Republican control of Washington is happening,’ House Speaker Paul Ryan told reporters over the weekend.
It’s the widest-ranging reshaping of the tax system in three decades and is expected to add $1.46 trillion to the nation’s debt over a decade.
Speaker of the House Paul Ryan (L), R-Wis. and Senate Majority leader Mitch McConnell (R) believe have signaled they are confidant they can pass tax reform legislation before Christmas
Trump touted the nation’s economy, predicting that it would ‘start to rock’ once the bill is passed
The GOP plans to muscle it through Congress next week before its year-end break.
Under the bill, today’s 35 percent rate on corporations would fall to 21 percent. The legislation would lower taxes on the richest Americans. Benefits for most other taxpayers would be smaller.
Republicans released their long-awaited tax overhaul bill late Friday afternoon, drawing months of negotiations to a close and setting up a pair of final votes on Monday and Tuesday.
The Tax Cuts and Jobs Act creates seven new tax brackets, including a 37 per cent rate – down from 39.6 per cent – for top-end wage earners.
The new rates start at 10 per cent and rise to 12, 22, 24, 32, 35 and 37 per cent.
The bill also lowers the top corporate tax rate from 35 per cent to 21 per cent, the largest such reduction in U.S. history.
Senate Minority Leader Chuck Schumer (L), D-N.Y., and House Minority Leader Nancy Pelosi, D-Calif say the bill is a gift to corporate interests as Democrats are unanimously opposed to the legislation
It makes changes to the income levels where the tax rates would kick in, raising the top tier by about $30,000 so only those earning $500,000 or more would be in the top bracket.
A change to the deductibility of mortgage interest will limit it to the first $750,000 of new home loans.
And Americans who inherit property won’t have to pay estate taxes on the first $11.2 million. That’s double the current exemption.
Some tax breaks that were written out of early versions of the bill are back in.
Those include a deduction for medical expenses and an exemption for graduate school tuition waivers. Americans paying off student loans will still be able to deduct the interest.
A promised $10,000 deduction for income and property taxes paid to states, counties and cities is also included – a compromise that attracted the support of lawmakers from high-tax states like New York and California.
The bill includes an expanded child tax credit, a move calculated to win the support of last-minute holdout Marco Rubio,. a Florida Republican senator.
It also eliminates the tax penalty placed on Americans who don’t buy medical insurance required by Barack Obama’s Affordable Care Act.
It also eliminates the tax penalty placed on Americans who don’t buy medical insurance required by Barack Obama’s Affordable Care Act
The nonpartisan Congressional Budget Office has cautioned that this may lead to more Americans not buying insurance policies, which could then contribute to premium-hikes for those who do.
The White House said in a statement that ‘[b]y lowering tax rates, simplifying the rigged and burdensome tax code, and repealing the failed tax on lower- and middle-income households known as the Obamacare individual mandate, this legislation will grow our economy, raise wages, and promote economic competitiveness.’
Democrats were predictably sour on the legislation.
The bill includes an expanded child tax credit, a move calculated to win the support of last-minute holdout Marco Rubio (pictured)
California Sen. Dianne Feinstein called the bill ‘awful’ and ‘one of the most irresponsible I’ve seen.’
‘In addition to driving up the deficit, it will increase health care premiums in the individual market by 10 percent each year, leave 13 million more Americans without health insurance and threaten to destroy a pristine section of the Alaskan wilderness.
‘I’m surprised anyone can call this a tax reform bill with a straight face,’ she said. ‘This is nothing more than a huge tax cut for big corporations and the rich, paid for by the middle class.’
Under the plan, however, Americans claiming the standard deduction instead of itemizing will have the benefit of a deduction that’s nearly doubled.
Republicans say that will result in millions of Americans filing a single-page tax return.
The final per-child tax credit will give families making up to $400,000 a year a $2,000 benefit per child.