browsing deer
Silver Member
Trump is as vague as a drunk about what loopholes he would close. Trouble is, every loophole is also a targeted tax cut with an entrenched constituency. I personally dislike almost all loopholes/targeted tax cuts (yeah, right..) but I realize killing them is next door to impossible. David Stockman, Reagan's budget director tried yeoman work to kill them. Stockman was gone in 15 months, and there were more of them at the end of Reagan's term than at the beginning.
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Mr Trump does suggest some new sources of revenue. He would eliminate many tax deductions, most of which remain unspecified. In particular, the controversial “carried interest” deduction, beloved of partners in private equity firms and hedge funds, would go. This raises, perhaps, $1 billion-2 billion. But Mr Bush promised this too, so it was included in his costings. Mr Trump would cap the tax-deductibility of debt interest. But Mr Bush would abolish it altogether, saving more. The only part of Mr Trump’s plan which is clearly cheaper than Mr Bush’s pertains to the overseas profits of American corporations. Unlike Mr Bush, Mr Trump would keep taxing these earnings (though companies will no longer be able to defer paying until the money is brought back, ending the incentive to stash cash overseas).
Mr Trump is supposed to be a new kind of politician; a straight-talker who, freed from the usual constraints of politics by his billions, tells it like it is. But promising to fund tax cuts by closing unspecified loopholes is an old political wheeze. Mr Trump says the country’s “top” economists helped to develop his plan; alas, for now they remain anonymous. Any contributor would be wise to stay in the background. Mr Trump’s plan is twaddle.
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Mr Trump does suggest some new sources of revenue. He would eliminate many tax deductions, most of which remain unspecified. In particular, the controversial “carried interest” deduction, beloved of partners in private equity firms and hedge funds, would go. This raises, perhaps, $1 billion-2 billion. But Mr Bush promised this too, so it was included in his costings. Mr Trump would cap the tax-deductibility of debt interest. But Mr Bush would abolish it altogether, saving more. The only part of Mr Trump’s plan which is clearly cheaper than Mr Bush’s pertains to the overseas profits of American corporations. Unlike Mr Bush, Mr Trump would keep taxing these earnings (though companies will no longer be able to defer paying until the money is brought back, ending the incentive to stash cash overseas).
Mr Trump is supposed to be a new kind of politician; a straight-talker who, freed from the usual constraints of politics by his billions, tells it like it is. But promising to fund tax cuts by closing unspecified loopholes is an old political wheeze. Mr Trump says the country’s “top” economists helped to develop his plan; alas, for now they remain anonymous. Any contributor would be wise to stay in the background. Mr Trump’s plan is twaddle.
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