While the Tax Policy Center and anyone with an ax to grind is out hammering the GOP and the President for giving the wealthy a bigger tax cut than the middle class, Chris Edwards says otherwise. Edwards, a friend of mine and director of tax policy studies at the Cato Institute, dials in on the tax plan, noting that while the wealthy are getting the largest average reduction in tax dollars paid to the government in the plan, as a percentage of taxes currently being paid, the Middle Class is getting the biggest cuts.
The TPC summary says, “Those with the very highest incomes would receive the biggest tax cuts,” and tables in the report encourage readers to come to that conclusion.
However, my parsing of TPC’s data reveals something different: the GOP plan would give the largest relative cuts to people in the middle. On average, middle-income earners would receive larger percentage tax cuts than higher-income earners.
The table shows data from TPC’s analysis and from its current law estimates released in March. Households are split into quintiles, or fifths, by income level. The columns titled “change” present the effects of the GOP cuts in different ways.
Read more here.
Chris Edwards discusses the GOP tax plan and 401(k) plans on CNBC’s Power Lunch
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