It’s a bait and switch. Somebody is going to pay and it’s going to be the middle class.
The GOP is quietly taking a back door approach to harvesting tax revenue from Americans. They are working at giving President Trump his lower brackets, but they are going to create tax revenue through the repeal of other deductions and exclusions.
The greatest possibilities to increase taxes will come from those who can afford it the least. The working class and the retired.
“The vast majority of households would actually be worse off”, according to a research report published by the Brookings Institute.
According to the report, the largest tax benefits will go to the highest income earners. The middle class will receive the least amount of benefit. So who is going to pay for those tax cuts?
Who Is Going To Pay For The Tax Cuts?
Some of the tax cuts costs will get added to the Federal Debt. The debt now stands at 20 Trillion dollars. Congress will put the problem in the hands of their future predecessors and our children.
Right now nobody is talking about the outcome of taxes needed to pay interest on the debt if rates rise. That is why the debt issue is critical to America’s financial stability.
The Chinese are the largest foreign holders of U.S. Treasuries. Imagine the possibilities if our relations soured with China.
If the Chinese sold off their Treasury holdings quickly it could cause a massive crash in the stock and bond markets. Nobody knows what’s ahead politically in that part of the world.
Included in Trumps list of targets for tax changes are
- Net investment income tax
- Individual alternative minimum tax
- Corporate alternative minimum tax
- The estate tax (affects married with 10 million or more)
- Repeal itemized deductions (except mortgage and charity, see fine print)
- Personal exemptions
- Certain capital gains at death (see fine print)