If you’re like myself and millions of Americans, you’re concerned about the future of our country and the welfare of our citizens more than ever. The least-popular President in modern history has made many promises to the American people, and few (non-divisive) promises have been fulfilled.
Today, we’re going to take a look at the promise by Donald Trump to “reduce taxes across-the-board, especially for working and middle-income Americans who will receive a massive tax reduction.” How does his proposed policy stack up and how will it affect you?
The Trump tax plan is based on two primary premises:
- It will simplify tax filing for Americans by reducing the number of tax brackets from 7 to just 3 (12%, 25%, &33%).
- It will lower taxes for working and middle-income Americans.
As you can see on this chart from HowMuch.net, reducing the number of tax brackets doesn’t always result in lower taxes.
While many Americans will benefit from the proposed change, the neediest Americans will be hurt the most.
- Single taxpayers earning under $9,275 and married joint-file taxpayers earning $18,550 or less will see their tax rate increase from 10% to 12%, meaning their take home pay will be lower.
- Single taxpayers earning between $37,500 & $37,650, and married joint-file taxpayers earning between $75,000 & $75,300 will see their tax rate increase from 15% to 25%.
- Single taxpayers earning between $112,500 & $190,150, and married joint-file taxpayers earning between $225,000 & $231,450 will see their tax rate increase from 28% to 33%.
Additionally, the standard deduction will increase from $6,300 to $15,000 for single filers, and from $12,600 to $30,000 for married joint-filers.
This may sound like a good thing, but it will negatively impact housing sales and charitable donations to non-profits. As more people choose not to itemize deductions, they’ll have little incentive to purchase a home or donate to charity without the tax benefits they were previously afforded. This will have far reaching effects in the non-profit sector, further burdening society’s most vulnerable.
While those working minimum wage jobs will have to rely on the government even more for basic necessities like food and shelter, Trump has proposed drastic tax cuts for the wealthiest Americans in hopes that some of the wealth will “trickle down” to the 99.99%.
The Trump plan is vague, so we don’t know exactly how it will affect Americans until it’s implemented. However, based on the details we’ve been given, we know it’s not good for the nation’s working poor and many middle-income Americans.