By Sahil Nandwani
On Wednesday, September 9th, Republican presidential candidate and former Florida governor Jeb Bush unveiled his new proposed tax code, an essential facet of his plan to create a sustained national economic growth of 4%. His plan is meant to fulfill the longtime goal of fiscal conservatives: completely replacing the current 80,000-page tax code with a simpler system.
The first and most important element of this policy is to reduce the number of income tax brackets, from seven down to three, and also decrease the top bracket rate from its current 39.6% to 28%, returning the top bracket to its state after President Reagan’s tax reform in 1986. This also includes cutting the nation’s corporate tax rate, one of the highest in the world, which incentivizes businesses to store money offshore, to 20% from 35%. Even with this cut, the rate would still be significantly higher than that of the tax-havens he plans to diminish. While the groundwork of this plan does seem to favor the wealthy, Bush’s new tax code is also largely influenced by the populist spirit of the lower classes.
The most interesting aspect on this side is that he claims, under this plan, roughly 15 million Americans will no longer be subject to the liability of an income tax. It also doubles the standard tax deduction that around 66% of Americans choose to take and eliminates the Social Security tax on workers’ earnings past the age of 67. Bush also plans to eliminate loopholes that allow wealthy individuals to minimize their taxes by classifying their income as capital gains, on which the tax rate is significantly lower. It will also destroy most corporate tax deductions, therefore decreasing the wealth inequality caused by huge corporations.
Bush’s plan has garnered both criticism and praise from both sides of the aisle. Conservative economists have condemned his policies attacking corporations while lauding his tax cuts across the board. At the same time, liberal economists support the populism of his policies while being enraged over his elimination of the estate tax and other taxes that they believe keep the wealthy’s fortunes in check.
This was the primary intention. His proposals both attack and agree with both ideologies and directly clash with every other major candidate in the election: his policies make Rubio’s seem not effective enough, his emphasis on populism trumps “the Donald’s,” the tax cuts he proposes collide with Walker, and his expansion of the Earned Income Tax Credit attacks Hillary Clinton’s focus on wage distribution. Bush’s plan single-handedly fights off his contenders as an amalgamation of all fiscal ideologies, meant to cross the aisle and erase the “anemic” 2% annual economic growth and replace it with a strong 4%, similar to the economic conditions in Florida while he was governor.
Whether or not this will end up successfully fending off Bush’s critics and separate him from the pack, if elected president, Bush has stated that he will introduce this into Congress as the Growth and Reform Act of 2017.
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