The Republicans are no longer the party of the hard-working professionalby James Kwak / October 4, 2017 / Leave a comment
It’s no longer enough to be rich in Donald Trump’s America. Now, it’s only the super-wealthy who matter. That’s the message of the tax plan released by the Trump administration last week.
If you are a garden-variety rich person earning a six-figure salary, like a corporate vice president, President Trump doesn’t actually have much to offer you. The top marginal tax rate will fall from 39.6 per cent to 35 per cent, but today the higher rate only kicks in well above $400,000 per year, which puts you comfortably in the top 1 per cent. At the same time, the Trump plan eliminates personal exemptions and, more importantly, the deduction for state and local taxes, which mainly benefits high-income people with big houses in high-tax states. According to the nonpartisan Tax Policy Center, Trump could even be raising your taxes; by the time the law is fully phased in, the average family between the 80th and 95th percentiles of the income distribution (that is, the top 20 per cent, excluding the top 5 per cent) will pay slightly more in taxes than it would otherwise.