A tax plan that cuts taxes for all Americans but increases taxes for some wealthy Americans is so bad that some experts say the plan is doomed to fail.
The Trump administration on Monday released its tax plan, which is expected to be announced Tuesday by the White House.
The president’s plan would lower the top rate for all income earners from 39.6 percent to 35 percent, while lowering the top corporate tax rate from 35 percent to 20 percent.
But many experts say that proposal would leave the top 2 percent of earners, or roughly 1.6 million people, worse off than they would have been under the previous administration.
The top 1 percent would be able to pay a much smaller share of their income in taxes, while many other Americans would see their taxes go up because the top 1% would receive an average tax cut of $2,400, according to a new analysis from the Tax Policy Center.
The Tax Policy Institute estimates that the top two percent of taxpayers would receive $9,700 in tax cuts under the Trump plan, while the bottom 2 percent would see an average of $10,800 in tax relief.
The plan also would lower taxes on the wealthy by $3,000, the analysis found.
The proposal would also give corporations an average $9.4 billion in tax breaks in the first year, which could boost their tax bill to about $11 trillion by 2027.
But it would also create a new tax credit that would give the wealthy even more tax breaks.
Under the current tax code, those who make more than $1 million are given a $1,000 credit, which would raise about $2 trillion in revenue.
The Congressional Budget Office estimates that under the plan, that subsidy would cost the government about $500 billion.
That means the top earners in the U.S. would get a big tax cut under the tax plan while those at the bottom would be hit by a big drop in tax revenue.
“The proposal would add to the already-high federal deficit, as the top tax rate would rise to over 40 percent,” the Tax Reform Coalition, a nonpartisan group that supports reducing the top income tax rate, said in a statement.
“It would lead to a huge increase in federal debt and would likely lead to even larger spending cuts than under current law.”
Republicans are still debating whether to include $1.9 trillion in cuts to the military and border security that they plan to pass as part of the GOP tax bill.
The GOP plan would eliminate the $1 trillion tax credit for low-income people who make $50,000 or less.
The Senate bill, on the other hand, would eliminate that credit entirely.
In addition, the tax bill would slash corporate taxes, which are higher than they have been in decades.
But the Tax Foundation, a conservative think tank, estimated that corporate taxes would go up by $2.2 trillion under the current plan.
