What’s going on with US tax reform? Let Quartz explain…
Sweeping changes are coming to the US tax system. The Republican-led House and Senate have proposed tax reform bills that are similar enough that something like them will probably pass into law. If the majority party’s lawmakers can quickly agree on a compromise—a big “if”—it may happen by the end of the year.
Sweeping changes are coming to the US tax system. The Republican-led House and Senate have proposed tax reform bills that are similar enough that something like them will probably pass into law. If the majority party’s lawmakers can quickly agree on a compromise—a big “if”—it may happen by the end of the year.
The Republicans’ tax proposals, as currently written, are pretty unpopular. As we approach the legislative endgame, now is a good time to take a step back and ask: How did we get here?
Quartz has been following tax reform for much of the year, and we are here to help. We’ve compiled a list of stories to demystify the debate and get up to speed if you’re just tuning in.
Why do Republicans think the US needs tax reform in the first place?
At its core, the proposals are mostly about cutting corporate taxes.
No, really, it’s mostly about cutting corporate taxes
Take a look at these charts.
Is cutting corporate taxes so deeply a good idea?
Probably, but someone has to pay for it.
Higher income taxes on the rich would do the trick. That’s not on the table.
Why not? ¯_(ツ)_/¯
Instead, Republicans plan to pay for the corporate cut via higher government debt and increasing taxes on some middle-income families.
Wait, so some middle-class families will pay more in taxes?
Yep.
So why, again, are Republicans so eager to pass a tax reform bill?
They are betting that cutting corporate taxes will “trickle-down” and boost economic growth.
Is it really a done deal?
Not necessarily. Some Republicans might decide they are uncomfortable increasing the debt, or that the proposals don’t help small businesses enough.
Got any tax-related factoids I can wow my friends with at our next cocktail party?
Of course! Take five…
The reform plan is worse for people in Democratic states than Republican ones.
The plan includes a thinly veiled attack on the endowments of Ivy League schools.
Small-government conservatives can cite high-tax Sweden as a model for repealing the estate tax.
True tax reform would mean introducing a value added tax (VAT), like nearly every other country.
What does this mean for Trump?
It turns out that it’s really good for Trump and his family’s businesses.