Republicans in the House released their tax bill today. After delays, debate and speculation, they are finally revealing the details of the bill President Donald Trump says is essential to American competitiveness.
“It’ll be the largest tax cuts in the history of our country by far,” the president said, promising the greatest overhaul of the American tax system will benefit businesses and the American working class. “We’ll make the tax code simple and fair so that the vast majority of Americans can file their taxes on a single sheet of paper. We will restore America’s competitive edge by lowering taxes on America’s businesses.”
Among the major changes: the corporate tax rate will be slashed from 35% to 20%. The standard deduction for middle-class families will roughly double. The child tax credit will increase from $1000 to $1,600, but there are ways that Americans may be paying more in taxes: mortgage interest deductions on future home purchases will be capped at $500,000 and state and local tax deductions will be capped at $10,000, which may be a blow to middle-class families living in high-tax areas.
The administration is putting pressure on Congress to pass “The Tax Cuts and Jobs Act” immediately, but not all Republicans are confident that it can get done that quickly. Peter King (R) New York Representative, says, “you’re talking about before Thanksgiving. How you can debate, study and learn about something in two weeks and vote on it, which is going to impact maybe the next 20 to 30 years is, to me, we should spend a lot more time on it.”
And Democrats are even more skeptical of the plan. Chuck Schumer, New York Representative, says, “Repeal the estate tax, create a huge, new loophole for wealthy individuals in the form of reduction in the pass-through rate, and lowering the big rates on corporations and the wealthy — this sure doesn’t fit the bill of helping the middle class.”
One thing that’s not changing are the taxes on 401k’s but everything is up for debate as the bill makes its way through the House.
–Lana Zak, ABC News