Tax Cuts: Its All About Capitalism

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A Socialist Project e-bulletin .... No. 1506 .... November 3, 2017

Tax Cuts: Its All About Capitalism

Marty Hart-Landsberg

Powerful corporations and the rich in the United States continue their winning ways. By narrow margins, both the House of Representatives and Senate have agreed on a budget proposal that calls for an increase in the federal deficit of $1.5-trillion in order to fund a major reform of the U.S. tax system that will make the rich and powerful even more so.

Republicans in each house of Congress still need to work out the specifics of their desired tax reform and then negotiate any differences before they can send the budget to President Trump for his signature. But, there seems to be general consensus on the following business tax changes:

* slash the top tax... rate on pass-through business income from partnerships and limited liability companies or sole proprietorships from 39.6 per cent to 25 per cent; most law firms, hedge fund and real-estate companies are pass-through companies in which profits are counted and taxed as the owner’s personal income
* reduce the corporate income tax from 35 per cent down to 20 per cent
* repealing the corporate alternative minimum tax
* replace the current global profit tax on business with a territorial tax, which means corporations will no longer be required to pay taxes on their foreign earnings.
* institute a one-time lower tax rate on repatriated corporate profits currently held outside the country.

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