The choice for voters is clear: a tax cut from Donald Trump or a pay cut courtesy of Hillary Clinton.
Trump is promising to slash income taxes to zero for millions of people currently paying them, and to reduce the tax bite on everyone else except the mega-rich.
Clinton, by contrast, isn’t cutting income tax rates for anyone. Instead, she’s campaigning to raise business taxes, despite warnings it will cause wages to plummet and the economy to tank.
No wonder Trump is moving up in the polls. Most Americans are still making less than they did in 2007. The mainstream media want to double down on “birthers” and other fabricated issues. But will voters really be fooled by such nonsense? Will they be so easily distracted? Trump is betting no – they’ll vote their wallets.
Trump proposes a zero income-tax rate for singles making $25,000 and couples making twice that. Instead of paying the government money, they’ll file a one-page tax form that says, in not so many words, “I win.”
Moving up the ladder, singles earning $35,000 will save about $1,000, according to tax experts at CNN Money. And singles earning $64,000 will get a $2,700 break, on average. Anyone earning $112,000 will save over $5,300. Sweet.
And that’s before applying Trump’s proposed deductions for child care, which will average $12,000 per child regardless of whether parents actually incur child-care expenses. That’s a boon for stay-at-home parents.
Bottom line: Working couples with two kids will pay no federal income tax on their first $60,000 to $70,000 in household income.
Clinton promises tax credits, too – but only to families that actually spend over 10 percent of their income on outside child care.
Disregard Clinton’s bogus claims that Trump wants “to give trillions in tax breaks to people like himself.” Nonsense. Trump caps deductions at $100,000 for singles and double that for couples, so some high rollers will end up paying more.
As for the misery of tax preparation, Trump simplifies it: only three brackets, all with lower rates than before. He jokes about putting H&R Block out of business. Clinton’s plan adds complexity: more brackets and additional rules.
Keeping more of what you earn is good. Earning more is even better. To give everyone a shot at a brighter economic future, the next president and Congress need to jump start the economy by slashing business taxes.
Right now, the economy is limping along at 1.2 percent growth – a third of the normal growth rate over the last century. Partly to blame for the stagnation are corporate taxes – the highest in the developed world. They’re driving companies to leave the United States and putting those who stay at a global disadvantage.
Trump proposes cutting taxes by over half for large and small businesses in order to encourage them to stay, expand and hire.
Meanwhile, Clinton preaches class warfare, vilifying businesses for not “paying their fair share” and pledging tax hikes on them. Recession, here we come. A Federal Reserve report warns that “increases in corporate tax rates lead to significant reductions in employment and income.”
Typically, Democrats bash business tax cuts as “trickle down economics” to benefit rich Republicans. But the inspiration for Trump’s tax reform came from a Democrat – John F. Kennedy – who faced a stagnant economy when he became president in 1961.
Kennedy understood tax cuts would cause businesses to invest, boosting worker productivity. More productive workers lead to higher wages as well as more goods and services to go around. A more prosperous nation.
Kennedy startled the nation by insisting that tax cuts would ultimately produce more tax revenue – not less – thereby reducing deficits. He was right, as Larry Kudlow explains in his new book “JFK and the Reagan Revolution.”
JFK slashed business taxes, and after his assassination, Congress enacted the rest of his tax program, igniting 5 percent annual growth for the next eight years.
Reagan repeated the formula in the 1980s, launching 20 years of 4 percent-plus growth.
It can happen again. Hillary has given up on growth. Voters can’t afford to.
Betsy McCaughey is a senior fellow at the London Center for Policy Research.