The Guardian reports on the recently passed tax change law:
Along with Trump himself, Wilbur Ross, the commerce secretary; Linda McMahon, administrator of the Small Business Administration; Betsy DeVos, the education secretary; Steven Mnuchin, the treasury secretary; and Rex Tillerson, the secretary of state, will benefit to the tune of $4.5m from changes to the estate tax, according to the CAP.
More than 90% of businesses in the US are “pass-through businesses”, meaning their income passes through to the owners’ individual tax returns, where it is taxed at ordinary income tax rates, instead of being filed on a separate business return like a corporation. The sweeping tax bill cuts the top rate on “qualified” pass-through business income from 39.6% under current law to 29.6%.
Assuming the full benefit of this, the CAP roughly estimates a tax cut of $11m to $15m for Trump (based on an estimate of $150m of passthrough income from reviewing his financial disclosure, and the $109m in real estate/pass-through income on his 2005 tax return); $5m to $12m for Jared Kushner, White House senior adviser and Trump’s son-in-law; and $2.7m for Betsy DeVos, the education secretary.
The bill that passed the Senate had a “guardrail” that prevented businesses with too few employees from claiming the full benefit of the deduction, the CAP noted. But at the last minute, a special exception was added that is especially beneficial to real estate firms.
And CNBC adds:
Those [same] benefits will now go to roughly four dozen Republican House and Senate members who voted for the bill, according to an analysis of personal financial disclosures for CNBC by the Center for Responsive Politics. They include Sens. Ron Johnson of Wisconsin, Bob Corker of Tennessee and James Inhofe of Oklahoma and Reps. Diane Black of Tennessee and Vern Buchanan of Florida.
So do these lawmakers really believe their tax change bill will remain in force for years to come? Given the recent polls concerning the mid-terms, it’s quite conceivable the Democrats will control both chambers of Congress in little more than a year, and my suggestion to that hypothetical Congress is that they pass a bill that simply negates the tax change bill of the Republicans – a single sentence will do.
And if Trump balks, you just point out to him that the tax change bill was a major component in the failure of the GOP, and does he really want to be associated with such a loser bill? Phrase it properly and he’ll collapse like a house of cards.
So why did the Republicans force through a bill so hastily that it’s a mess, that is full of special favors to their own members? Do they really think the mighty GOP marketing machine can wing them through another election? I have a lot of respect for that machine, but I think this time they’re in for a bruising, shattering loss. The incoming Congress will be expected to remedy a lot of the blunders of the previous Congress, regardless of what the Trump base thinks.
And it’ll leave one more severe, permanent scar on the hide of a lot of lawmakers.
