Trump’s Ambitious Tax Agenda Could Put More Money In Your Pocket
President-elect Trump may be able to increase Americans’ incomes through a series of changes to the tax code, according to experts and insiders.
Throughout his campaign, Trump made repeated promises to reduce taxes on tips and Social Security benefits, and even proposed the full elimination of income taxes, aiming to replace the lost revenue with tariffs.
With the major tax cuts from Trump’s first term set to expire in 2025, and Republicans likely to hold full control of Congress, extending and potentially expanding these tax cuts is a top priority for him.
A key focus of Trump’s proposed tax changes is the reduction of corporate tax rates.
In 2017, Trump lowered the corporate tax rate from 35% to 21%—and now, he wants to cut it further to 15%.
“When you reduce the corporate rate by 2% wages go up 1%, corporations have more money to invest for workers,” Grover Norquist, an activist and president of Americans for Tax Reform, told The Post.
Norquist, a seasoned insider in GOP tax circles, predicted that both House and Senate leadership would fully support this reduction.
Trump has also vowed to undo one of the provisions of his 2017 tax reform: the $10,000 cap on state and local tax (SALT) deductions.
This cap primarily affects residents of high-tax blue states, where hefty state and local taxes fund large state governments. Trump’s pledge to repeal it could lead to a rare bipartisan achievement.
“I take President Trump at his word and will hold him accountable for his promise to eliminate the SALT cap. I will work with him and anyone to get things done on behalf of the people,” said Long Island Democratic Rep. Tom Suozzi, a vocal critic of the SALT cap.
However, insiders suggest that repealing the cap could prove much more challenging.
“The major problem is it pits high tax states against low tax states. Certain states like New York and California and New Jersey have really high and state and local tax rates, and it gives people who live there an advantage in their deductions over people who live in [low-tax] places like Florida or Texas,” said Phil Magness, an economic historian at the Independent Institute.
Far-left progressives might also be reluctant to support what they see as a tax break for the wealthy. Socialist Squad Rep. Alexandria Ocasio-Cortez has criticized past attempts to remove the SALT cap as a “gift to billionaires.”
Norquist, however, expressed uncertainty about Trump’s ability to fully eliminate the cap but suggested that raising the deduction could serve as a reasonable compromise.
{Matzav.com}