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Congressional Republicans released their long awaited blueprint for an overhaul of the tax system and, not surprisingly, there are some winners and losers. While it's still very early in the process, the plan as written would be the first major rewrite of the tax code since the early days of the Bush Administration.
The proposal suggests narrowing down the tax brackets into three categories, four less than the current seven brackets. The poorest Americans would see an increase from 10% to 12% while the wealthiest Americans would see a decrease from 39.6% to 35%. The plan currently doesn't stipulate what the income limits are for each of the three proposed brackets of 12%, 25%, and 35%.
The business tax rate would drop dramatically from 35% to 20% while also getting rid of many deductions business take advantage of.
Other things in the initial blueprint foresee a larger standard deduction for individuals while getting rid of many popular deductions at the same time. It would also repeal the Alternative Minimum Tax (AMT) and the Estate Tax - two taxes that the only the wealthiest Americans pay.
Republicans have not explained how they intend to pay for the proposal, which would certainly add billions of dollars to both the debt and deficit, which will be a test to see if Republicans truly care about those two or if they simply used them as talking points during the Obama era.
As I said earlier, we're still in the very beginning stages of negotiations, but this plan or one similar to it stands a very good chance of passing the Republican Congress.
Is anyone paying attention to the negotiations? If so, what do you think of the proposal as it's currently written?