The middle class and the United States as a whole are (hopefully) going to finally receive the tax relief that they need. After years of nothing being done by politicians to revise our tax code, by simplifying it, closing the loopholes, and reducing taxes, the GOP has finally put out a decent plan to revive the nation. Although I am thrilled to see certain fixes made, there are others that really bother me.
For example, let’s start with the 15% cut in taxes on corporations. The U.S. corporate tax rate is currently the highest in the industrialized world, thus taking away any advantage the U.S. would have in attracting new businesses from foreign countries. In fact, there are numerous companies that have either considered or entirely moved their operations into different countries simply because it costs too much to operate a business here. We lose out on thousands of jobs all the time just because of the tax rate. Now, what would these companies do with the extra 15% savings? Liberals would like you to think that the greedy capitalist swine will just keep the money locked away in their Scrooge McDuck money bins where they swim in gold all day long. If this sounds insane, that’s because it is. In order to make money, you have to spend money. These companies are likely to put that money into research and development, as well as wage increases for all employees and wages for entirely new employees. A move like this helps to keep humans competitive over robots in certain jobs because it is still cheaper to pay a human than to maintain a high-cost machine. Overall, this plan shows signs of creating a more robust and innovative economy than ever before.
The other major point here is the reduction in a number of income brackets as well as the tax rates on them. The top earners making over $418,000, will be taxed roughly the same, at 35%. So to the Liberals who think just because you earn more, you should pay more, you can rest your heads knowing the feared Bernie Sanders “1%” will still pay high tax rates. (By the way, if you don’t know much about this, I recommend watching the tax debate between Bernie Sanders and Ted Cruz.) Personally, I think this is wrong because any money that you earned is yours and should remain that way, but the government thinks otherwise. It doesn’t matter if you make one thousand per year or one million per year, you deserve to keep all of your money. Now for the remaining three brackets, most of them will notice a very small change in their taxes, but it will be enough to save them a nice chunk of their paycheck.
There’s also the issue of tax credits and deductions. Right now, anyone with children will see a nice increase in their credit, as well as anyone not being able to claim a dependent. But there is also the issue of health care, state taxes, mortgage deductions, adoption, and student loan interest deductions. This is a slam to the middle class, which needs these deductions to get by. But at the same time, this will force Congress to take action on health care and state legislatures with high taxes to lower their taxes in order to remain a business and residential friendly state.
There is also an interesting provision in the bill that would tax private universities such as Stevens. According to Business Insider, “Private universities with assets of more than $100,000 per student will pay a 1.4% excise tax on their net investment income.” This will force schools like Stevens to cautiously analyze how much they are charging students, how many students they have, and how much money is available per student. This could cause some universities to go into spending frenzies to get below that $100,000 per student mark, which in turn could help to stimulate the economy and help the university. Or the bill could cause the university to lose a lot of money, creating a dangerous impact on the resources of that university to do better for its students.
There is so much to unpack in this bill that it would take me at least two columns to analyze, but overall, as of now, it’s not bad, but it could be a lot better if Republicans stuck to simple conservative principles. It is critical to recognize that this is the first form of the bill, and it will clearly undergo significant changes. Be sure to keep up with the news and any new developments to learn more about the final product.