With President Trump set to announce his tax plan this
week, optimism regarding corporate tax cuts have helped increase financial
markets to near all-time highs. Trump’s outline has not gone without its fair
share of criticism though, citing the reform as an attack on the working class
to further fatten the pockets of big business.
Under our current tax system, corporations are taxed
thirty five percent, causing large employers to turn to other countries for
hiring purposes and decreasing the wages willing to be paid to employees to
maintain sufficient profit. Another setback we see with this model, is taxes
paid by corporations are largely passed down to investors, consumers, and once
again, workers. President Trump hopes to achieve corporate tax reduction down
to a flat fifteen percent, offering an incentive for business to increase
investments in expansion and innovation, while providing better wages for the
American worker and keeping jobs here at home.
In addition to the corporate aspect of Trump’s tax
plan, income tax for individual and married tax payers will be simplified from
the current seven brackets down to three, while also doubling the standard
deduction. These actions will benefit individuals from all class levels while
also incentivizing people to rejoin the workforce instead of relying solely on
government welfare.
As critics cry out in disdain, virtue signaling their
support of the working class while simultaneously swapping favors with the same
Wall Street bankers they claim to oppose, we should be willing to look
skeptically at the current flawed system and act on making fundamental changes.
1 comment:
I disagree that Trump's tax plan will, in reality, be a benefit for all. The proposed tax plan is classic "Reaganomics", huge tax cuts for the wealthy and businesses and the money will trickle down to the middle/lower class. While this does sound nice in theory, it hasn't ever worked in practice. What usually ends up happening is that the lack of taxes being paid by those can afford it has to be made up somewhere, and that somewhere usually ends up being from those who cannot afford it or barely afford it. This ends up in the hoarding of wealth in the top bracket and systematic pressure/elimination of the mid to low bracket.
This sort of tax proposal is the exact reason why we have the amount of disproportionate distribution of wealth that we have now. A better tax system would have those that can afford taxes being taxed at a higher rate and those that cannot afford taxes being taxed at a lower rate. This promotes growth in the mid to low class and establishes a market in which large businesses and the wealthy cannot hoard 80% of the nation's wealth. This type of system proved to be effective during WWII and post WWII in which the wealthy were taxed at an outrageously high rate with a booming workforce. Obviously, the situation is not the same now as it was in the 1940's, but the same system is likely to even out the wealth distribution as well as relieve pressure from the lower tax brackets.
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