Thursday, September 28, 2017

Tax Legislation, Anyone?

Last spring the Trump administration came up with a vague, one-page proposal for revising the Internal Revenue Code. After months of reportedly serious effort, a six-man task force has expanded  the proposal to a vague, nine-page plan.

But "it's not really a plan," as Catherine Rampell points out in The Washington Post:
At best it’s an outline, offering barely more detail than the bullet points the Trump administration released in April. It doesn’t even specify the thresholds for the individual income-tax rates it proposes. It also doesn’t identify a single individual tax preference it would kill, despite claiming to simplify the code and close lots of “loopholes.” Even the state and local tax deduction, which administration officials have talked about eliminating, isn’t explicitly mentioned.
While we wait for Congressional Republicans to come up with an actual tax bill, there's plenty to wonder and worry about. How can abuse of the proposed 25% tax rate on income "passed through" businesses such as partnerships  be prevented? What if repeal of the estate tax (which affects almost nobody) exposes millions of Americans to capital gains tax on inherited assets?

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