Trump Administration's Tax Promises Face Steep Financial and Legislative Challenges
The ambitious tax proposals of President-elect Donald Trump, including the elimination of taxes on advice, overtime and social security benefits, face significant obstacles while preparing to take office. While these promises are intended to relieve millions of Americans with high living costs, implementing such large-scale measures will require a complex legislative and fiscal landscape. Trump and Republican legislators have made tax reform a top priority, with continued efforts to extend the 2017 law on tax cuts and employment, which will expire in 2025. However, these measures, combined with other budget cuts, are expected to add over $7 trillion to the federal deficit over the next decade, according to the Responsible Federal Budget Committee.
One of the most important promises of Trump’s campaign – eliminating the tax on advice – has already raised legislative proposals in Congress. Senator Ted Cruz introduced the Non-Tax Board Act, which would allow workers to deduct federal tax boards. However, the measure does not address wage taxes, and experts caution that it could open the door to tax abuse by the high income that shifts income into points. Similarly, proposals to end the tax on social insurance benefits face procedural obstacles, as these changes cannot be approved under the Senate reconciliation rules without bipartite support. These challenges raise the question of whether Trump’s broader fiscal agenda will be expanded or progressively implemented.
Cost remains a crucial issue, as legislators take into account the financial impact of Trump’s promises. Extending the 2017 tax cuts alone could cost more than $4 billion, while additional measures, such as interest on self-deductible loans and the removal of coverage of state and local tax deductions, could increase the financial burden. Critics, including the Center for American Progress, caution that such policies could disproportionately benefit high-income households, leaving middle-income and low-income families with limited assistance. Meanwhile, economists have rejected Trump’s proposal to offset revenue losses with higher rates, which argue that tariffs alone cannot replace revenues generated by federal income tax.
Despite these obstacles, Republican leaders are moving forward with the development of a tax package that aligns with Trump’s campaign promises. Senator Mike Crapo, who was committed to leading the Senate Finance Committee, highlighted a commitment to growth-friendly fiscal policies, while recognizing the need for fiscal prudence. To implement its program within the first 100 days, analysts anticipate that commitments will be required to balance budget constraints with strategic objectives. While Trump’s radical vision for tax reform can become a reality, it remains uncertain, but bets are high for taxpayers and the federal budget.
Source: https: / / / www.cn.com / 2024 / 11 / 16 / politics / taxes-tips-tromp-campaigns / index.html
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