David_42
Registered Democrat.
- Aug 9, 2015
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Hilarious.
Jeb Bush’s new tax plan could cost $3.4 trillion over next decade
Jeb Bush’s new tax plan could cost $3.4 trillion over next decade
This item has been updated.
Just three tax brackets. No more taxes on death or marriage. Tax cuts for major corporations and small businesses and about 42 million families.
[Tax proposal comes as Bush tries to gain ground on Trump]
Republican presidential candidate Jeb Bush on Wednesday unveiled a long-awaited tax reform plan that would add trillions of dollars to the deficit, filling in details that he says would help fulfill his promise to restore 4 percent annual economic growth. With a North Carolina factory as his backdrop, Bush married traditional conservative thinking on taxes with some politically viable proposals that already enjoy support on Capitol Hill.
The plan would add $1.2 trillion to the deficit, even when using a system favored by Republicans that takes into account any potential growth the tax changes could encourage, according to Republican economists who reviewed the plan on Bush's behalf. The plan would lose closer to $3.4 trillion using traditional methods.
Given the high price tag and some of the details, Bush's tax plan is fraught with political peril. His brother, former president George W. Bush, focused much of his 2000 presidential campaign on plans to slash taxes and jump-start economic growth. Those tax cuts contributed to the record deficit spending that even Jeb Bush criticized Tuesday night on Stephen Colbert's new late-night talk show. In 2012, GOP presidential nominee Mitt Romney had similar ideas on tax reform that were widely dismissed by voters, who believed he was pushing policies that would mostly help wealthy people.
[Analysis: What's new and what isn't in Jeb Bush's tax plan]
So Bush is also embracing an idea also backed by GOP frontrunner Donald Trump and Democrats, including President Obama and Hillary Rodham Clinton. He would end a lucrative tax loophole for hedge fund and private equity managers that lets them avoid billions of dollars in taxes by treating their income as capital gains instead of salaries.
"My plan works whether you're on Main Street or Wall Street – no special favors, no special breaks," he told workers and invited supporters at Morris & Associates, an industrial refrigeration company in Garner, N.C.
Bush described the current tax code as "a disaster."
“It punishes people for doing things we should encourage and rewards people for doing things that may not be so good," he added. "It taxes paychecks hard but gives companies a write-off for debt. The current tax code makes it easier to borrow than to build. I believe it’s time we build for the future, not borrow from it."
Later, he explained his plan by using what he claimed was a common Florida phrase: "We need to let the big dog eat. We need to focus on creating a fair environment, and then let people pursue their dreams as they see fit."
If Bush becomes president, he would seek to condense seven tax brackets into three: 10 percent, 25, percent and 28 percent. He would slash the corporate tax rate to 20 percent, end the Alternative Minimum Tax, the estate tax and the so-called marriage penalty tax, while continuing deductions for charitable giving. Bush also would cut home mortgage deductions to just 2 percent and eliminate state and local tax deductions, essentially goading local governments to slash high tax rates.
Independent assessments of the total cost of Bush's proposals weren't immediately available. But in advance of its release, the Bush campaign asked four GOP economists -- John Cogan, Martin Feldstein, Glenn Hubbard and Kevin Warsh -- to analyze the plan. Buried within their 17-page analysis was the trillions-dollar price tag. Notably, they did not factor for Bush's goal of 4 percent economic growth, instead presuming that an additional 0.5 percent per year in growth would come from the tax plan and another 0.3 percent from proposed regulatory reforms. That would still leave the U.S. economy short of 4 percent annual growth.
Bush spokeswoman Allie Brandenburger dismissed the traditional scoring of such plans as "antiquated" and "irrelevant, except to partisan liberals who think that we can tax our way to prosperity."