The Republican tax bill got worse: now the top 1% gets 83% of the gains

[Amica Nostra 4,803]

https://www.vox.com/policy-and-politics/2017/12/18/16791174/republican-tax-bill-congress-conference-tax-policy-center

 

In its last year, the bill raises taxes on more than 53 percent of Americans.

By Dylan Matthews@dylanmattdylan@vox.com  Dec 18, 2017, 4:01pm EST

 

By 2027, more than half of all Americans — 53 percent — would pay more in taxes under the tax bill agreed to by House and Senate Republicans, a new analysis by the Tax Policy Center finds. That year, 82.8 percent of the bill’s benefit would go to the top 1 percent, up from 62.1 under the Senate bill.

And even in the first years of the bill's implementation, when it’s an across-the-board tax cut, the benefits of the law would be heavily concentrated among the upper-middle and upper-class Americans, with nearly two-thirds of the benefit going to the richest fifth of Americans in 2018.

Tax Policy Center

The paper is the first rigorous analysis of who wins and loses under the bill as agreed to in conference committee. House and Senate negotiators agreed to a number of changes in the bill, most notably lowering the top income tax rate for individuals to 37 percent from its current level of 39.6 percent. The analysis does not include an additional cost of the legislation: its repeal of the individual mandate, which the Congressional Budget Office estimates could cause as many as 13 million fewer people to have health insurance, reducing federal spending for poor and middle-class Americans’ health insurance by $338 billion over 10 years. That worsens the bill’s distribution for the poor and middle class.

[Voice of Reason 10,298]

So the takeaway on this is... in 2018, you might not get much of a tax cut if you are in the 2/3 quintiles, but you will see a tax hike if you are in the 4/5 quintiles.  So lower income families will pay see a net gain/loss of zero, 2/3 will gain about $100, and the 4/5 will pay more taxes.  Doesn’t seem fair to me, but at least they are not cutting taxes drastically.  That’s a good thing,

[Amica Nostra 4,803]

1 minute ago, IDWAF said:

So the takeaway on this is... in 2018, you might not get much of a tax cut if you are in the 2/3 quintiles, but you will see a tax hike if you are in the 4/5 quintiles.  So lower income families will pay see a net gain/loss of zero, 2/3 will gain about $100, and the 4/5 will pay more taxes.  Doesn’t seem fair to me, but at least they are not cutting taxes drastically.  That’s a good thing,

what is interesting is that the corporate rate changes are baked in forever, the individual changes expire

[eieio 1,594]

2 hours ago, Il Mango Dulce said:

what is interesting is that the corporate rate changes are baked in forever, the individual changes expire

Thats one of the great parts about this plan. Another thing that gives me hope is that 51 senators have said they will vote yes TOMORROW. Even if McCain can't make it…Pence can break the tie. 

 

The amount of lies that the democrats are screaming about this says it all. They want people to be dependent on the government.       This tax cut will boost the economy, provide more jobs, give taxpayers the right to keep more of the money they earned ect.  All things democrats hate. 

[Amica Nostra 4,803]

20 minutes ago, eieio said:

Thats one of the great parts about this plan. Another thing that gives me hope is that 51 senators have said they will vote yes TOMORROW. Even if McCain can't make it…Pence can break the tie. 

 

The amount of lies that the democrats are screaming about this says it all. They want people to be dependent on the government.       This tax cut will boost the economy, provide more jobs, give taxpayers the right to keep more of the money they earned ect.  All things democrats hate. 

The fact that only 27% of Americans think this is a good deals speaks volumes on why they want a Democratic Congress.

[Italian_in_NYC 259]

20 minutes ago, Il Mango Dulce said:

The fact that only 27% of Americans think this is a good deals speaks volumes on why they want a Democratic Congress.

As a tax professional (specialized in intl matters nonetheless), I wouldn't care about that.

I like this bill. The US had (still has, hopefully for only two more weeks) the most archaic and absurd corporate tax code (and rates) for US multinational companies.

Finally it's moving to a territorial system, just like any other industrialized country. And there are plenty of anti-abuse rules, especially on BEPS.

Corporate tax systems are a HUGE variable in the country's competitiveness. At 21% we'll be in line with most of our trade competitors, and without the absurd corporate worldwide system (which only produced monsters like MNEs holding $200bn of cash overseas).

The individual provisions are good for families with kids, as it should be. And not just at the lower level, but also at middle and upper-middle class levels (raising the phase-out threshold at $400k for married couples is a good thing).

I saw plenty of clients today and over the weekend, most of them in the top 1%. All of them are going to pay more next year. The benefit is only for pass-through owners (not service providers though) with plenty of employees and capital-intensive business, which is a good incentive for the economy.

[eieio 1,594]

52 minutes ago, Il Mango Dulce said:

The fact that only 27% of Americans think this is a good deals speaks volumes on why they want a Democratic Congress.

It speaks volumes on how the corrupt media still has the ability to sell lies. Once it passes and people see the positive effects…the numbers will reverse.

 

26 minutes ago, Italian_in_NYC said:

As a tax professional (specialized in intl matters nonetheless), I wouldn't care about that.

I like this bill. The US had (still has, hopefully for only two more weeks) the most archaic and absurd corporate tax code (and rates) for US multinational companies.

Finally it's moving to a territorial system, just like any other industrialized country. And there are plenty of anti-abuse rules, especially on BEPS.

Corporate tax systems are a HUGE variable in the country's competitiveness. At 21% we'll be in line with most of our trade competitors, and without the absurd corporate worldwide system (which only produced monsters like MNEs holding $200bn of cash overseas).

The individual provisions are good for families with kids, as it should be. And not just at the lower level, but also at middle and upper-middle class levels (raising the phase-out threshold at $400k for married couples is a good thing).

I saw plenty of clients today and over the weekend, most of them in the top 1%. All of them are going to pay more next year. The benefit is only for pass-through owners (not service providers though) with plenty of employees and capital-intensive business, which is a good incentive for the economy.

Great post!

[Italian_in_NYC 259]

I am disgusted by the media portraying the SALT deduction elimination (actually decrease and cap) as an outrageous move against high-tax blue states.

I haven't been able to get a real tax benefit from my (huge) NY and NYC tax bill since I started making 6-figures. Forget about when my wife also started making a good living. It has been taken back by the AMT.

I actually ran a simulation on my personal situation today and if the new bill were enacted for 2017, I'd pay over $9k less in Federal income taxes. The actual $10k deduction (without the AMT) gives me a much greater tax benefit than the $40k SALT deduction all taken back by the AMT.

Folks out of the AMT (meaning above it) will be hit in NY, CA, NJ, HI... that's why they lowered the top rate to 37% from 39.6%... to give them some (partial) relief.

Edited December 19, 2017 by Italian_in_NYC

[Amica Nostra 4,803]

1 hour ago, Italian_in_NYC said:

As a tax professional (specialized in intl matters nonetheless), I wouldn't care about that.

I like this bill. The US had (still has, hopefully for only two more weeks) the most archaic and absurd corporate tax code (and rates) for US multinational companies.

Finally it's moving to a territorial system, just like any other industrialized country. And there are plenty of anti-abuse rules, especially on BEPS.

Corporate tax systems are a HUGE variable in the country's competitiveness. At 21% we'll be in line with most of our trade competitors, and without the absurd corporate worldwide system (which only produced monsters like MNEs holding $200bn of cash overseas).

The individual provisions are good for families with kids, as it should be. And not just at the lower level, but also at middle and upper-middle class levels (raising the phase-out threshold at $400k for married couples is a good thing).

I saw plenty of clients today and over the weekend, most of them in the top 1%. All of them are going to pay more next year. The benefit is only for pass-through owners (not service providers though) with plenty of employees and capital-intensive business, which is a good incentive for the economy.

Hurrah for the top 1%, are we going to add VAT tax as an offset? Here's the deal, give the lowest 25% bracket a tax  break and it goes direct to economic stimulation, the professed claim to fame of this legislation.  Corporate tax breaks go to stock buy backs no investment, and those in my bracket and above? Screw them.

 

 

 

[Voice of Reason 10,298]

3 hours ago, Il Mango Dulce said:

Hurrah for the top 1%, are we going to add VAT tax as an offset? Here's the deal, give the lowest 25% bracket a tax  break and it goes direct to economic stimulation, the professed claim to fame of this legislation.  Corporate tax breaks go to stock buy backs no investment, and those in my bracket and above? Screw them.

 

 

 

That’s so cute... screw everyone that makes more than you.  Why, the devilishness of it all!  They don’t deserve a break!

 

How about a flat tax rate for everyone, and no tax refunds at all?  You pay each paycheck on what you earn, period.  You don’t need deductions for kids.  You create ‘em, you pay their way.  

[Dashinka 24,793]

1 hour ago, IDWAF said:

That’s so cute... screw everyone that makes more than you.  Why, the devilishness of it all!  They don’t deserve a break!

 

How about a flat tax rate for everyone, and no tax refunds at all?  You pay each paycheck on what you earn, period.  You don’t need deductions for kids.  You create ‘em, you pay their way.  

That is the hate speech that comes from the MDL.

[Amica Nostra 4,803]

5 minutes ago, Bill & Katya said:

That is the hate speech that comes from the MDL.

Are you categorizing my speech as hate speech?

[Dashinka 24,793]

3 minutes ago, Il Mango Dulce said:

Are you categorizing my speech as hate speech?

Did I mention your name?

[Amica Nostra 4,803]

6 minutes ago, Bill & Katya said:

Did I mention your name?

I am picking up on the fact that a paraphrase of what I said was held up as hate speech by you.

[eieio 1,594]

It certainly sounded hateful. Maybe you could clarify if you hate successful people or not?