Tax Cut Analysis

Heated debates over tax cut have always been one of the central economic themes on the American political table. Since taxes relate directly to the quality of lives, it is by no means surprising to find people showing significant concern about policies regarding cutting or raising the amount they have to pay. The idea that lowering tax rate makes room for growth has remained generally popular among the majority, taking a possible decrease in individuals’ tax burden and increase in productivity into account. There is, however, extensive research conducted on the topic that produced controversial results. Despite its appeal to instant benefits for one’s saving account and investment, reducing tax rate has yet to show a definite positive effect

In states without state income tax, higher sales, property and other assorted taxes can exceed the annual cost of a state income tax. Texas is one of seven states that do not levy an individual income tax. The Tax Foundation, a conservative-leaning research group, ranks Texas ninth-best on its State Business Tax Climate Index, largely because of the state’s lack of an income tax. On three of the foundation’s other major rankings — property taxes, sales taxes and corporate taxes — Texas ranks in the bottom 20 states. Texas does not have a statewide property tax, but local property taxes remain a crucial complaint among businesses and homeowners. (Terrence, 2002) The main benefit is that states with no income tax become a beacon for growth. They 're better at creating jobs and keeping a core of young, educated workers from moving to other states. The issue is undoubtedly controversial. Public opinion usually swings with the size of one 's paycheck and the role people think governments should play in shaping society. Texas has an above-average sales taxes, and Texas also has higher-than-average effective property tax rates. Cutting the income tax will boost take-home pay for everyone. It 'll make the state more attractive than its neighbors, creating jobs, drawing new businesses, and sparking an influx of talented workers.

Tax decreases can stimulate economic growth because if people are paying less in taxes, they have more money to spend. It has been proven over the years that tax decreases generate economic growth and federal revenue will always rise. From a personal standpoint I always spend more during tax season because I usually get a good return; since I am a single parent and full-time student, therefore, I qualify for various tax breaks. These obviously affect my household because I am more disposable income. Tax decreases can help a business if their taxes are decreased the organization will payout less and have more income.

However, raising taxes on the rich and corporations is not as helpful to our economy as most people think. Although raising taxes on the top percent of people and companies appears to create more income for the government, the result will make it harder for middle class and lower class citizens to grow. Some argue that by combining several key changes, including the simplification of the tax code to avoid loopholes and the decrease of taxes on the rich and corporations, there will be an improvement in the national economy. Although this may seem a bit counterintuitive, it makes more sense when looked at closely. By lower taxes and remove all loopholes, smaller businesses are given further opportunities to grow instead of facing financial roadblocks and government

Collections were $61 million below expectations in July, August and September (combined total). Following that, the total receipts were $15 million, or almost 3 percent, below expectations in October, according to the Kansas Department of Revenue. Added up, in the first four months of the fiscal year starting in July, Kansas is now roughly $76 million under revenue expectations. The state broke out of an eight-month-long streak of missed estimates in November. But December’s lower-than-expected receipts (under $11 million) ruined hopes of the November figures (up $8 million) in which we thought was the start of a new, positive trend. Ever since 2013, the tax cuts have fallen short of creating the surge of new dollars that Brownback once boldly predicted would almost immediately flow to the state. Also, the state has been among the worst in the nation in recently in creating new nonfarm jobs, again, the opposite of what Brownback had said would happen after the tax cuts were implemented. On July 1, the statewide sales tax jumped from 6.15 percent to 6.5 percent. “The fact that sales tax revenue was below estimates, even after Republicans passed a massive sales tax increase, is an indication of just how much Kansas families are struggling under the Brownback tax plan,” said House Minority Leader Tom Burroughs, D-Kansas City. “A tax plan that is overly dependent upon a sales tax is neither

Since taking office Sam Brownback has hit Kansas people with many taxes and also tax cuts that cripple the financial state of Kansas.”Brownback wanted to eliminate the earned-income tax credit, which had benefited the working poor”(Judis). By taking this away Sam Brownback hurt the everyday working class person by taking away this money. Some of the poor working

The debates on tax cuts are making their way to headlines of every radio station, newspaper, and television station in America. Today, tax cuts would only benefit the wealthy and wouldn’t really benefit the lower class. “The administration and it’s congressional alleys are proposing to sharply reduce taxation of the business income primarily benefiting

Sam Brownback has not done this. When his tax plans failed, he tried to cover them up. It is clear that the Kansas economy is failing due to his policy changes: “The Kansas gross state product grew at a faster rate when compared to the region and the nation in three of the five years before he took office in 2011.” In addition, several other indicators of economic welfare show Kansas trailing behind the nation (Abouhalkahl). Rather than taking responsibility for his failure, he has tried to cover it up and has not done anything to fix it. The economic counsel appointed by the governor had been putting out reports of the Kansas economy until recently they stopped. When revealed, almost all indicators told the story of a failing Kansas economy (Abouhalkah). When Sam Brownback realized his plans were failing, rather than admitting to the public his failures and working to fix them, he tried to cover them up. Worse than his inability to take responsibility for the mess Kansas has become, is his relationship with the Koch brothers and the way it affects his policies. The Koch brothers have long time supported the governor, helping to fund and back his campaigns and policies. This support has bought them loyalty. The once wind energy supportive governor is now in favor of phasing out a

Sam Brownback is trying to create more jobs by using tax cuts in Kansas. In order to create more

This economic expansion and boost would occur through citizens who would spend the extra tax money on products and services in their geographical region or who would invest money into businesses in their area. The only problem for the government using this theory would be the initial revenues that the government would lose from the tax cuts. In theory the economic growth would eventually increase taxable incomes, this increase in taxable incomes should cause the governmental revenues to grow in the long run. With the idea of Reaganomics in mind President Reagan persuaded Congress to pass the Economic Recovery Tax Act, which is the first major step in his plan. This Tax Act called for a 25 percent tax cut that was implemented over a three-year period (David Mervin, 1990, 133-7). The only problem with this tax cut is the fact that it mainly benefited the upper - income taxpayers and large corporations. The reason that these groups were targeted is because there is more of a chance that they will invest their money in business programs that will promote economic growth. After this tax cut took effect the American people in the lower - income tax brackets were not pleased with the results. They seemed to be faced with an increase in their tax rates even though most of them were in the income categories below the national average. On the other end of the spectrum the people that were in the upper tax brackets were experiencing significant tax cuts. The

Fiscal Policy can be explained in many ways, for example. Fiscal policy is the use of the government budget to affect an economy. When the government decides on the taxes that it collects, the transfer payments it gives out, or the goods and services that it purchases, it is engaging in fiscal policy. The primary economic impact of any change in the government budget is felt by particular groups—a tax cut for families with children, for example, raises the disposable income of such families. Discussions of fiscal policy, however, usually focus on the effect of changes in the government budget on the overall economy—on such macroeconomic variables as GNP and unemployment and inflation.

The tax cuts from 2001 and 2003 reduced the top four marginal income tax rates. The 2001 tax cuts did accomplish their intended goals, Republicans and Democrats tend to differ when it comes to tax cut benefits, I agree with the average democrat approach towards stimulating economic growth.

The encouragement of economic disparity because of these tax cuts is bad for America. The US should be aiming for more social and economic equality for everybody. Tax cuts can slow down the economy by putting more money into the wealthy peoples’ hands and giving less to the people who need it.

“By reducing taxes for households and businesses, the reform would boost consumer spending and business investment in the short term, lifting economic growth”(3). This viewpoint is shared by many analysts that support President Trump’s new tax reform. The most impactful change caused by the Tax Cuts and Jobs Act is the corporate tax cut from 35% to 20%, and the repeal of the corporate alternative minimum tax(4). This change will result in companies losing a lot less money in taxes and having the ability to use that money towards capital and investment purchases. These new benefits could also sway companies to stay within the united states, as outsourcing and moving overseas would no longer result is as big of tax relief and increased profits. This new incentive for companies to stay local within the united states would increase local business, and the boost in business and investment spending would directly result in an increase in the United States’ aggregate demand and a boom in our country's economy. All of these factors, in theory, would come together and fulfill Trump’s goals of economic growth while avoiding any increase in our national debt. The problem, however, becomes apparent when looking at the actual potential this

I agree with you that with the neoliberalism views, under Thatcher in UK and Reagan in US, the administration cut taxes significantly. Harvey states: “Corporate taxes were reduced dramatically, and the top personal tax rate was reduced from 70 to 28 per cent in what was billed as ‘the largest tax cut in history’” (Harvey 2005). So, cutting taxes seems like a good idea, but at the same time the government most likely will start cutting budget, cutting back on some government programs. The rich started to accumulate more wealth and those in need for various government programs, were disadvantaged. In result, there was a shift for greater social inequality and the economic power of the upper class was reestablished.