President Donald Trump hasn’t released a specific tax agenda if he were to be re-elected, but millionaires could reap big benefits if he simply wins an extension of the cuts he signed into law in 2017, according to a new analysis.
Many of the tax cuts, including decreases to individual tax and extra deductions for businesses owners, are set to expire at the end of 2025. If nothing is done, rates at all income levels would return to those in effect before the law’s enactment.
For the top 0.1% of taxpayers — those with income in excess of $3.7 million — tax bills would bump up by an average of $71,000 in 2026, according toestimates from the Urban-Brookings Tax Policy Center released Tuesday.
The size of Trump tax tax cut varies widely across income groups. Overall the average cut in 2026 if current rates are extended would be $1,460, compared with an expiration of the law. The lowest-earning 20% of taxpayers, or those make less than $26,300, would get an average benefit of $80 if the cuts were extended.
Those all would rise if the tax law expires on schedule. But extending the 2017 tax overhaul would come with a cost — an additional $1.1 trillion to the deficit over a decade, according to the estimates.
Trump has said he also wants to pursue a second tax cut if he is re-elected, cutting rates for middle-earners, decreasing the corporate rate more and creating new tax breaks for companies that bring jobs back from offshore. TheTax Policy Center said they didn’t have enough information about those proposals to model their effects. White House economic adviser Larry Kudlow said Monday that Trump willnot release a detailed tax plan ahead of the election.
Any tax proposals Trump were to pursue if re-elected would mean he would need to compromise with Democrats, who are projected to maintain a majority in the House and could pick up a Senate majority. That would likely mean that most of Trump’s tax priorities would be stalled or the scope of the tax cuts greatly mitigated.
Democratic presidential candidate Joe Biden has proposed to increase taxes on households earning at least $400,000 and corporations, which could increase federal revenue by $2.4 trillion over a decade, according to the Tax Policy Center. The top 0.1% of taxpayers would see their tax bills increase by nearly $1.6 million a year on average, according to their estimates.
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