Nearly half the benefits of the plan, and a higher proportion of savings, would go to the top 1%
.. The group, which consists of about 1.1 million households and earns 17% of total income, would owe 25% of federal taxes for 2017 under Trump’s plan compared with 28.7% under current law... nearly half the benefits of Mr. Trump’s tax plan would go to the top 1%, households earning more than about $700,000 annually... high earners are often more able than lower earners to reap long-term capital-gain income, which is now taxed at a top rate of 23.8%. Under current law, 78% of long-term gains go to those in the top 1%.
Will Political Reality Derail Markets’ Bet on Donald Trump?
The Committee for a Responsible Federal Budget estimates that Trump’s plans would add $5.3 trillion to the federal debt over the next decade.
House Republicans, in particular, don’t like that kind of number, and that has the potential to mess with both tax-cut and infrastructure plans. Look for a moment of truth in mid-2017, when a Republican president and a Republican Congress have to agree on a plan to raise the federal debt ceiling or face a market-rattling default on American debt.
Donald Trump’s Spending Push Rankles Fiscal Conservatives
Republicans hope to avert ballooning deficits that may result from president-elect’s low-tax, big-ticket agenda
This suggests the GOP will be willing to tolerate higher deficits in the short-run under Mr. Trump because the party is largely united on overhauling corporate and individual income taxes.
.. And reduced revenues, they worry, could be used to justify big cuts to safety-net programs like food stamps and Medicaid.
.. Under current policy, the Congressional Budget Office sees the budget deficit of 3.2% of gross domestic product holding around those levels for the next four years. By the end of Mr. Trump’s first term, deficits would rise to 5.3% of GDP under the House Republicans’ tax plan, and to 6.8% under Mr. Trump’s proposal, according to an analysis by Cornerstone Macro, a research firm.
.. The last two times Republicans reclaimed the White House from Democrats—in 1981 and 2001—they also successfully pushed for large tax cuts. Deficits nonetheless rose during their administrations.
.. Deficits have also fallen below projections in recent years due to a surprising decline in the growth rate of health care spending and because interest rates have been lower than projected.
.. Already, Mr. Trump has forsworn any changes to the largest future drivers of spending, Social Security and Medicare.
.. Other advisers say they are open to recycling a proposal made by President Barack Obama and Democratic nominee Hillary Clinton to pay for infrastructure with one-time revenues from taxing multinationals’ profits stashed abroad.
.. Mr. Trump’s chief strategist, Stephen Bannon, has echoed arguments made in recent years by left-leaning economists who supported more spending to boost growth.
“With negative interest rates throughout the world, it’s the greatest opportunity to rebuild everything,” Mr. Bannon said
Deal for Carrier to Keep U.S. Plant Open May Hinge on Tax Overhaul
Talks include the conglomerate’s plans to shift more than 2,000 jobs from Indiana to Mexico
The incoming president’s goal is to show that he can keep some of his boldest campaign promises, and the CEO needs to keep peace with the federal government, a critical customer for products like its jet fighter engines. Military sales account for roughly 10% of the company’s $56 billion annual total, the company says.
United Technologies, like other globalized U.S. companies, also has large reserves of cash overseas—profits that corporations are waiting to repatriate to the U.S. until Congress cuts the level of tax they would pay. The company reported that 85% of its total cash, or more than $6 billion, was overseas, as of the end of 2015.
.. Democratic Sen. Bernie Sanders said Saturday that Mr. Trump must make it clear that if United Technologies “wants to receive another defense contract from the taxpayers of this country, it must not move these plants to Mexico.”
.. The company is the sole provider of jet engines for the F-35 Joint Strike Fighter.