The Tax Policy Center, a joint project of the liberal Urban Institute and Brookings Institution, analyzed the proposed tax plans of the 2016 presidential aspirants.
Below are the abstracts or summaries of the tax proposals of Hillary Clinton, Bernie Sanders, Donald Trump, Ted Cruz, and Marco Rubio. The contrasts between the Democrats and Republicans are stark:
- The Republicans all propose to decrease taxes in some way or another — which would decrease tax revenue by trillions of dollars only if the economy remains anemic — and to increase incentives to work, save, and invest.
- In contrast, the Democrats Hillary and Bernie both propose to increase all kinds of taxes, not just the income tax, although both claim it’s “the rich” who will be hit the most, with Hillary claiming that the top 1 percent would get nearly all of the tax increases. Like the good commie he is, Bernie promises the moon, claiming that the increased tax revenue could pay for universal healthcare, college education, and family leave, entirely ignoring the $20 trillion national debt.
- By claiming to increase taxes mainly on “the rich,” Hillary and Bernie both promote class warfare and divisiveness, with Hillary being the most rabid by singling out the top 1% vs. the 99%. Since Hillary herself and her Wall Street backers (especially Goldman Sachs) precisely are the One Percent, it’ll be interesting to see if she and they would get hit with her proposed increased taxes. Call me a cynic and skeptic, but I doubt it.
The Republicans
Donald Trump’s Tax Plan
This paper analyzes presidential candidate Donald Trump’s tax proposal. His plan would significantly reduce marginal tax rates on individuals and businesses, increase standard deduction amounts to nearly four times current levels, and curtail many tax expenditures. His proposal would cut taxes at all income levels, although the largest benefits, in dollar and percentage terms, would go to the highest-income households. The plan would reduce federal revenues by $9.5 trillion over its first decade before accounting for added interest costs or considering macroeconomic feedback effects. The plan would improve incentives to work, save, and invest. However, unless it is accompanied by very large spending cuts, it could increase the national debt by nearly 80 percent of gross domestic product by 2036, offsetting some or all of the incentive effects of the tax cuts.
For details, see the -page report by Jim Nunns, Len Burman, Jeff Rohaly, and Joe Rosenberg, “Analysis of Donald Trump’s Tax Plan,” December 22, 2016.
Ted Cruz’s Tax Plan
Presidential candidate Ted Cruz’s tax proposal would (1) repeal the corporate income tax, payroll taxes for Social Security and Medicare, and estate and gift taxes; (2) collapse the seven individual income tax rates to a single 10 percent rate, increase the standard deduction, and eliminate most other deductions and credits; and (3) introduce a new 16 percent broad-based consumption tax. The plan would cut taxes at most income levels, although the highest-income households would benefit the most and the poor the least. Federal tax revenues would decline by $8.6 trillion (3.6 percent of gross domestic product) over a decade.
For details, see the -page report by Joe Rosenberg, James R. Nunns, Leonard E. Burman, and Daniel Berger, “An Analysis of Ted Cruz’s Tax Plan,” February 16, 2016.
Marco Rubio’s Tax Plan
Marco Rubio’s tax proposal would convert the federal income tax into a consumption tax by not taxing investment income of individuals and by converting the corporate income tax into a cash-flow consumption tax. It would replace most deductions and exemptions with a universal credit; eliminate estate taxes, the AMT, and all ACA taxes; and move the US to a territorial tax system. A new $2,500 child credit would aid families with children. Taxes would fall at all income levels, with high-income households benefiting the most. Revenues would decline by $6.8 trillion over a decade (assuming no change in economic growth).
For details, see the 50-page report by Elaine Maag, Roberton C. Williams, Jeffrey Rohaly, and James R. Nunns, “An Analysis of Marco Rubio’s Tax Plan,” February 16, 2016.
The Democrats
Hillary Clinton’s Tax Plan
Hillary Clinton proposes raising taxes on high-income taxpayers, modifying taxation of multinational corporations, repealing fossil fuel tax incentives, and increasing estate and gift taxes. Her proposals would increase revenue by $1.1 trillion over the next decade. Nearly all of the tax increases would fall on the top 1 percent; the bottom 95 percent of taxpayers would see little or no change in their taxes. Marginal tax rates would increase, reducing incentives to work, save, and invest, and the tax code would become more complex. The analysis does not address a forthcoming proposal to cut taxes for low- and middle-income families.
For details, see the 40-page report by Richard Auxier, Len Burman, Jim Nunns, and Jeff Rohaly, “Analysis of Hillary Clinton’s Tax Proposals,” March 3, 2016.
Bernie Sanders’ Tax Plan
Presidential candidate Bernie Sanders proposes significant increases in federal income, payroll, business, and estate taxes, and new excise taxes on financial transactions and carbon. New revenues would pay for universal health care, education, family leave, rebuilding the nation’s infrastructure, and more. TPC estimates the tax proposals would raise $15.3 trillion over the next decade. All income groups would pay some additional tax, but most would come from high-income households, particularly those with the very highest income. His proposals would raise taxes on work, saving, and investment, in some cases to rates well beyond recent historical experience in the US.
For details, see the 49-page report by Frank Sammartino, Len Burman, Jim Nunns, Joseph Rosenberg, and Jeff Rohal, “Senator Bernie Sanders’s Tax Proposals,” March 4, 2016.
~Eowyn
