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JERUSALEM – The 2017 Republican tax cuts have been a wave of campaigning ahead of the November mid-term elections. President Trump has therefore put forward a new plan: more tax cuts.
In Nevada Saturday, Mr. Trump said the Republican legislators and he were working on "a very significant tax break" for middle-income people, which will be implemented in the coming weeks.
There is no chance that such a plan will be adopted even in the House before the mid-session, let alone the Senate, because Congress is suspended during the elections. It is therefore an initiative to give Republican voters enthusiasm for the opening of the ballot box – and perhaps even to recognize the minimal size of Mr. Trump's tax bill, which seems to give the Republicans a way to control Congress.
Steven Mnuchin, Treasury Secretary, said Sunday in an interview that he was working diligently with Texas Representative Kevin Brady, Republican Chair of the House Ways and Means Committee, to develop another tax plan that will be published "shortly".
"This specifically concerns the middle class and not beyond," Mnuchin said in Jerusalem during the first leg of his trip to the Middle East in six countries.
Mnuchin said the president had asked Treasury officials and Republican lawmakers to focus on developing a tax plan for the middle class. But he could not give details on tax brackets that might have lower rates or indicate whether the package would include more generous deductions. Nor has anyone explained how – or if – the plan would be financed or whether it would again contribute to increasing the nation's deficit.
Last year's $ 1.5 trillion tax cut should add $ 1 trillion to the country's deficit, although Republican lawmakers continue to insist the tax bill will pay for more economic growth strong.
Mr Mnuchin said that the effect of the size and timing of the additional cuts on the country's finances was taken into account. This could mean that the government would seek to offset tax cuts by spending cuts or by raising taxes on other groups of taxpayers.
However, Mr Mnuchin reiterated his view that the tax cuts passed last year did not increase the debt, explaining that they would pay back if the current level of growth economic was maintained. There is There is no indication to date that the cuts have been profitable, even though growth has accelerated this year.
Mnuchin said the real factor of the debt was government spending, echoing Trump's complaint that Democrats insisted that funding for national programs be increased in exchange for approval. additional funds for the army.
House Republicans have decided to extend last year's personal tax cuts, which are expected to expire in 2025, while corporate tax cuts are permanent. The bill was passed in the House last month with little fanfare or effect on the polls during the House polls. He died when he arrived in the Senate, where Republicans held a small majority.
"It would be different from what the House had already adopted," said Mnuchin. "It's more, it's not instead of."
The tax cuts signed by Mr Trump at the end of last year include a sharp reduction in the corporate tax rate, which went from 35% to 21%, as well as cuts for other business owners and individuals. Independent analyzes show that they disproportionately help high earners – particularly wealthy white Americans.
The Joint Tax Committee, Congress's independent indicator for tax cuts, predicts that Americans earning $ 100,000 or more a year will make 75% of the savings from next year's cuts. If Congress allows personal income tax cuts to expire as planned, the committee predicts that middle-class Americans and low-income countries will face tax increases in 2025, while high taxpayers will continue to benefit from a tax break.
Democrats have imposed these cuts on the rich, which is one of the reasons why tax reform has not given Republicans the electoral benefits they expect.
After passing the cuts to Congress two months last year and having them passed without a single Democratic vote in either House, the Republicans insisted that the new law reinforce their mid-term perspectives. Surveys and messages from candidates suggest that this has not been the case.
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