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donald trump tax plan

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President Donald Trump is to announce his intention to cut the rate of corporation tax when he presents his tax plan later.

According to White House officials, the centerpiece of April 26 announcement will be a sharp reduction in the business tax rate, from 35% to 15%.

Economists say the tax cuts will add trillions of dollars to the deficit over the next decade.

However, Treasury Secretary Steven Mnuchin has said the tax plan “will pay for itself with economic growth”.

Steven Mnuchin declared it “the biggest tax cut and largest tax reform in history of this country”, according to The Hill.

Image source Flickr

Also expected in the plan:

  • some sort of repatriation tax, giving big companies an incentive to bring back money they hold overseas
  • tax breaks for childcare expenses
  • large increase to standard tax deduction
  • a cut in individual rates, although few details expected yet
  • more tax rate cuts for hedge funds, and other enterprises that pay taxes at individual rates
  • easing the tax form process

Donald Trump’s blueprint is not expected to include any proposals for raising new revenue.

The much-discussed border tax that would put a tariff on imports – favored by House Speaker Paul Ryan – will not be in the plan.

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Donald Trump has unveiled his tax plan, which would eliminate income tax for millions of Americans.

Wealthy Americans and businesses would also pay less in taxes under the Republican frontrunner’s plan.

Donald Trump’s plan would eliminate income tax for people earning less than $25,000 and married couples jointly earning less than $50,000.

The Republican presidential hopeful is coming under increasing pressure to outline specific policy goals beyond immigration reform.

Donald Trump has previously put out papers, outlining his positions on immigration and gun rights.

“It will provide major tax relief for middle income and for most other Americans. There will be a major tax reduction,” he said on September 28.

“It will simplify the tax code, it’ll grow the American economy at a level it hasn’t seen for decades.”

Photo Getty Images

Photo Getty Images

About 43% of Americans already do not pay income tax, according to the Tax Policy Center.

About 31 million more Americans would fall under Donald Trump’s no-income-tax bracket, he said.

The economy would grow at least 3% a year under his plan, Donald Trump predicts.

On average the US economy grows 1 to 2% per year. Rival presidential candidate and former Florida Governor Jeb Bush had promised a 4% growth rate under his policy proposals.

Many economists had criticized Jeb Bush’s growth rate, calling it unreasonable.

He said the US would pay for the tax cuts without adding to the national debt through eliminating deductions and loopholes that have allowed some people, mostly wealthy ones, to save money on taxes.

“In other words, it’s going to cost me a fortune,” he said.

Under his plan, the highest individual tax rate would be lowered to 25% of income from the highest rate now, 39.6%.

The plan would also put a 10% tax on overseas profits and put a tax on overseas earnings, which now can be deferred.

It would lower the tax rate on businesses to 15% from 35%.

The so-called “death tax”, in which the US government charges certain wealthy individuals to transfer the high-valued property of a deceased person to someone as outlined in a will, would also be eliminated under Donald Trump’s plan.

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