The Republicans are pushing for a tax code overhaul. That was one of Trump’s campaign promises. But Trump’s track record on delivering many of those campaign promises is not making the Republican Party dance in the street. The Republican healthcare bill is down for the count, and the famous “wall” will not happen unless Congress sneaks the money through the back door of another bill. Some experts say Trump and Company will put the wall cost in the defense budget. But all eyes are on the Tax code battle that is brewing in Congress. The first assessment of the Republican tax code is not getting rave reviews from Republicans or Democrats. Senator Bernie Sanders thinks Trump is trying to give his billionaire buddies a tax break at the expense of the middle class. House Speaker Paul Ryan didn’t say that on the CBS Show “Face the Nation,” but he said not all middle-class folks will get a tax break.
Congressman Ryan said the focus of the new tax code is the people who work from paycheck to paycheck. Ryan thinks those workers are struggling. By decreasing the number of individual tax brackets from seven to three, and doubling the standard deduction, those people will put more money in their pockets. Gary Cohen, Trump’s chief economic advisor, said he does not guarantee all middle-class earners will pay less in taxes, during an ABC interview. During that interview, he also said those earners may pay more.
According to the nonprofit, the Tax Policy Center, people earning between $50,000 and $150,000 will pay more in federal taxes under the new tax code. The center also said the wealthy, not the middle class or low-income earners, would benefit. The new code would eliminate the deduction for paying local and state income taxes, and that would hit some middle-class earners hard, according to a CBS article. Ryan believes the new tax plan would be deficit-neutral, but he said nothing about the bill being revenue-neutral. According to the Tax Policy Center federal revenue will drop by $2.4 trillion over the next ten years. Trump and Republicans are depending on three percent GDP product growth a year to pay for the cuts. Paul Ryan stuck his neck out and said the tax plan would create faster economic growth. But opponents of the bill say the changes are not the right changes to make the economy grow.