#特朗普税改 Main Content

• Individual Income Tax: The House version simplifies the federal individual income tax rate from 7 brackets to 4 brackets, with the highest federal individual income tax rate remaining unchanged at 39.6%; the Senate version still maintains 7 brackets, but the highest federal individual income tax rate is reduced to 38.5%.

• Corporate Income Tax: The corporate income tax is significantly reduced from 35% to 20%. For the $2.6 trillion in profits currently held overseas by multinational corporations to avoid taxes, only a one-time payment of 14% is needed to legally repatriate it to the U.S.

• Taxation System: The global taxation system is transformed into a territorial taxation system, exempting taxes on dividends from overseas subsidiaries. At the same time, a new 20% “excise tax” is added for multinational corporations to limit their ability to avoid taxes through internal transactions with branches outside the U.S.

Reasons for Reform

• Reducing the Wealth Gap in the U.S.: The Gini coefficient in the U.S. is relatively high, remaining above 0.46 in recent years, indicating a significant wealth gap. The tax reform aims to reduce the tax burden on American families, especially middle-class families.

• Encouraging Repatriation of American Companies' Overseas Profits: To encourage American companies to bring their overseas profits back to the U.S., the tax reform changes the taxation system from residence-based to territorial, lowering the cost of repatriating overseas profits.

• Boosting the U.S. Real Economy: Measures such as simplifying tax laws, lowering corporate taxes, reducing taxes for the middle class, and encouraging American companies to repatriate profits held overseas are aimed at boosting the U.S. real economy.

Impact

• On the U.S. Economy: While some argue that tax reform can stimulate economic growth and increase employment, many economists are skeptical, believing it may trigger higher inflation, increase budget deficits, and raise concerns about long-term effects.

• On the Global Economy: U.S. tax reform has an “externality” effect, potentially attracting global capital to the U.S., putting other countries under greater competitive pressure to attract businesses and investments, and even possibly triggering a global race to reduce taxes.