Contentious Tax Reforms Pass Senate

By: DailyForex.com

The Republican Party enjoys a majority in both the Senate and the House of Congress and so, theoretically, has a free-hand to pass whatever legislation it wishes. This situation has finally allowed passage of one of President Trump’s flagship policies, a major tax upheaval.

Critics of the tax reforms claim that it represents a major windfall to the nation’s richest individuals and corporations. Whilst the president has claimed that the reforms will cost him personally “a fortune” he is set to gain $30 million from the repeal of the “alternative minimum” tax. When pressed on exactly how much the president would gain personally from the cuts, the White House press secretary argued that as his taxes were currently being audited, they could not be disclosed. “We expect that it likely will, certainly on the personal side, could cost the president a lot of money. The president’s focus hasn’t necessarily been at all on himself.” His taxes were being audited during the campaign in 2016, it is surely one of the longest audits on record.

The bill will trim $1.5 trillion out of the US exchequer. The non-partisan Joint Committee on Taxation and the Congressional Budget Office believe that the cuts in the bill will disproportionally benefit corporations and the wealthy. The top income tax band is being cut from 39.6% to 37% and corporation tax is being slashed from 35 to 21% a whopping reduction. The Republicans claim that this reduction will allow corporations to invest more in the USA, creating more jobs and boosting the economy. Given that US employment is effectively considered to be full employment, if a vast swathe of new jobs were to be created, they would need a boost in immigration to fill – this would be an anathema to Trump’s America first support base.

The Democratic Party are implacably opposed to the reforms, the most sweeping since 1986, House minority leader Nancy Pelosi described it as: “the worst bill in history”; “an all-out looting of America, a wholesale robbery of the middle class”. She went on to say that: “The GOP tax scam will go down, again, as one of the worst, most scandalous acts of plutocracy in our history.”

The aftermath of the tax reforms will be played out in next year’s mid-term elections where the Democrats will be seeking to overturn the Republican majorities in the Senate and Congress.

Dr. Mike Campbell is a British scientist and freelance writer. Mike got his doctorate in Ghent, Belgium and has worked in Belgium, France, Monaco and Austria since leaving the UK. As a writer, he specialises in business, science, medicine and environmental subjects.