February 28, 2017

Contrary to Rhetoric, President’s Tax Plan Will Disproportionately Benefit Wealthy Taxpayers and Corporations

press release

Contact: Jenice R. Robinson, 202.299.1066 x 29[email protected]

Following is a statement by Matthew Gardner, senior fellow at the Institute on Taxation and Economic Policy, regarding President Donald Trump’s address to Congress. During the speech, Trump said he will reduce the corporate tax rate and provide “massive” tax relief for the middle class.

“The president’s call for a lower corporate tax rate is based on a false premise. While he said that American companies pay the highest tax rate in the world, numerous studies by ITEP have shown that this is not the case. The reality is that numerous loopholes allow companies to pay well below the 35 percent statutory rate, with many companies paying nothing in taxes year after year. Rather than giving corporations a huge tax cut, we should close loopholes and ensure that corporations finally pay their fair share.

“The speech came without concrete tax proposals, but an analysis of Trump’s campaign trail tax plan revealed that 40 percent of its tax breaks would go to the richest 1 percent of Americans. Moreover, his plan would usher in hundreds of billions in annual deficits, ballooning the national debt by $4.8 trillion over a decade. Most working families want good jobs, good schools, sound infrastructure, access to health care, but tax cuts for the wealthy and corporations aren’t a road map for fulfilling this promise.

“We all should be wary of any tax policy proposal that is premised on failed trickle-down economic theories and relies on dynamic scoring sleights of hand to predict extraordinary economic growth.”