Two of US president Donald Trump’s tax cut plans announced today stand out as being clearly beneficial to…Donald Trump and his family.
- The Alternative Minimum Tax (AMT): Designed to ensure that the super-rich have at least one loophole they can’t jump through—or, as the Internal Revenue Service puts it, so they “pay at least a minimum amount of tax”—this forced Trump to fork out an extra $31.3 million in 2005, as we learned when part of his tax return for that year was leaked. That pushed his total tax rate up to 25% on earnings of $153 million—which means he paid in the tax bracket that normally covers a married couple making from $75,000 to $152,000. If the AMT it didn’t exist he would have paid just $7.1 million, or 4.6%.
(We don’t know if Trump has paid taxes any other year in the last two decades—returns from 1995 show he could have offset them for 18 years.)
- The Estate Tax: Getting rid of the estate tax—a move once dubbed the “Paris Hilton Tax Cut”—would free the richest 0.2% of Americans from having to pay up when they inherit an estate worth $5.49 million or more. The rate depends on how much the estate is worth, but the average amount paid in 2013 was 16%. However, the top possible rate is 40%—meaning that if Trump’s claim of being worth billions is true, his kids could in theory end up paying billions back to the Treasury when he dies. Given the tens of billions his cabinet is worth, one might suspect they’d be happy with this cut, too.