#TrumpTaxCuts
President Trump's tax cuts, also known as the Tax Cuts and Jobs Act (TCJA), were enacted in 2017 and are set to expire soon. Here's what's happening:
Key Provisions
- *Individual Income Tax Cuts*: Most individual tax cuts are scheduled to expire at the end of 2025, which would increase taxes for 62% of taxpayers.
- *Business Tax Cuts*: Some business tax cuts have already expired or are phasing out, while others will expire in 2028.
- *Corporate Tax Rate*: The TCJA reduced the corporate tax rate, which has boosted capital investment by an estimated 11%.
Proposed Extensions
- *Permanent Extension*: Trump has called for a permanent extension of the 2017 tax cuts, which would decrease federal tax revenue by $4.5 trillion from 2025 to 2034.
- *New Proposals*: Trump has also proposed additional tax cuts, including:
- *No Taxes on Tips*: Exempting tips from income tax.
- *No Taxes on Overtime Pay*: Exempting overtime pay from income tax.
- *No Taxes on Social Security Benefits*: Exempting Social Security benefits from income tax.
- *Deduction for Auto Loan Interest*: Creating a deduction for auto loan interest for American-made cars.
Economic Impact
- *GDP Growth*: Extending the TCJA would increase long-run GDP by 1.1%, offsetting $710 billion of the revenue losses.
- *Budget Deficit*: The Congressional Budget Office estimates that extending the expiring provisions would add $4.6 trillion in deficits over 10 years.
- *Tariffs*: Trump's proposed tariffs would offset more than two-thirds of the long-run economic benefit of his proposed tax cuts ¹..