What Sort of Tax Reforms Does the American Public Really Want?
What sort of tax reforms does the American public really want? What do they expect from President Trump as he formulates the tax policy in coming years? Most Americans say that while they want lower taxes, they don’t want the revenues to go down, and want the national deficit to be under control.
This is according to a survey conducted by Program for Public Consultation (PPC) of the University of Maryland. Over 1,800 registered voters participated in the survey where they were asked to write the nation’s tax code and make tax rate changes as they wished. They made changes in six tax categories and came up with their own preferred tax cuts and hikes.
President Trump wanted many changes to the tax code and had said so during his election campaign. He wanted the taxes on capital gains and dividends to be cut and for estate tax to be eliminated. He wants to offer a series of tax relief measures for small businesses, such as partnerships and sole proprietorships.
PPC claims that none of the tax cuts proposed by Trump during his campaign have the approval of the majority of the public or even that of the majority of the Republicans.
Most respondents in the survey made tax code changes that led to a revenue increase of $112.2 billion a year. Trump’s tax plans, on the other hand would result in a revenue loss of $441.9 billion if implemented, as per a study by the Tax Policy Center.
Democrats that took part in the survey wanted a larger revenue increase of $118.5 billion, while Republicans wanted higher tax revenues, but only by $36.2 billion.
PPC Director Steven Kull said, “The American public appears to be far more concerned about the deficit than the president. One of Trump’s repeated comments was ‘I will listen to you.’ Just because you’re elected doesn’t mean that you’re aligned with the will of the people.”
Generally the participants in the survey wanted the taxes on incomes over $100,000 to be raised by 5 percent. This would affect 22 percent of the working population in the US. President Trump, on the other hand, wants the effective tax rate for those that earn in the high income bracket to be brought down from 39.3 percent to 33 percent.
52 percent of the respondents in the survey wanted a higher tax rate by about 10% to be levied on those who make $1 million or more. Most people did not want any cuts on capital gains and dividends, as that they did not want this to be lower than the tax rate paid by those earning ordinary salaries. As of now the capital gains tax is 16.5 percent.
Over 63% of the participants wanted higher tax rates for high income earners. They wanted the tax rate for those that made $430,000 and above to be raised from 23.8% to 28%.
Also, many wanted the effective corporate tax rate to be 20.2%, up from the current levels of 19.2%.
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