Plan Calls For Reductions To Individual, Corporate, Capital Gains Taxes
Republicans have put forth a new, 35-page tax proposal, which outlines five main issues with the current tax code and offers solutions to address them. These issues include “burdensome paperwork and compliance costs” for businesses, as well as penalties individuals face for “savings and investment.” Politico reports that the tax plan calls for reducing “individual tax brackets to three from seven, with rates set at 33 percent, 25 percent and 12 percent, compared to the current range of 10 percent to 39.6 percent” Additionally, in an effort to reward individuals who invest their savings, the plan would make a “substantial cut on capital gains and dividends,” dropping the current top rate of 23.8 percent and taxing them at “16.5 percent, 12.5 percent or 6 percent, depending on how much the investor earned.” On the corporate tax side, The Hill reports the GOP proposes to drop the corporate tax rate from 35 percent to 20 percent, cut that would represent “the largest reduction in U.S. history, according to the document.” Further, the plan would allow businesses “to immediately write off the costs of their capital investments.” The GOP’s proposal would also no longer require US corporations “to pay U.S. taxes on income earned abroad,” but rather allow US companies not to pay “U.S. tax on dividends from their foreign subsidiaries.”
What This Means For Small Businesses
Small business owners suffer under a burdensome regulatory code that makes tax time costly and time-consuming. Reforms to the tax code could ease the burden for America’s job creators, but they must be done in a way that takes the needs of small businesses into account. It remains to be seen whether this Congress has the ability to pass meaningful reforms to benefit small businesses.
Additional Reading
The Daily Caller also covers the story.
Note: this article is intended to keep small business owners up on the latest news. It does not necessarily represent the policy stances of NFIB.
