By Lauren Pescatore
Yesterday, President Trump released a plan to make sweeping changes to our nation’s tax code. As it stands, the plan consists of a 200-word list of bullet points. Until further details are released, preliminary analyses show that it would primarily benefit corporations and the wealthy, while providing little relief for low-wage workers and their families.
Specifically, the plan would:
- Reduce the seven existing income tax brackets down to three, with rates of 10 percent, 25 percent and 35 percent. The income levels that would determine each of these rates are still unclear.
- Cut the corporate tax rate by more than 50 percent.
- Abolish the alternative-minimum tax and estate tax.
The plan makes no mention of Trump’s earlier proposal to help low-wage workers afford the cost of raising a family by expanding the Child and Dependent Care Credit (CDCTC) and offering child care spending rebates through the Earned Income Tax Credit (EITC).
Instead, the plan disproportionately benefits higher-income earners and corporations. Aside from reducing the top rate on corporate and individual income tax, it would end the significant stream of revenue brought in by the estate tax.
At a time when income inequality is on the rise, prioritizing tax breaks for lower-wage families over corporations and the wealthy should be at the top of every lawmaker’s bulleted list.