Why cut taxes?

[cowboy]

My typos don't add $1 trillion to the deficit.

Neither does the tax bill.

But while we're on the subject, if your concern is the deficit and you don't want to pay more, who should?

[Uncle Ted]

Neither does the tax bill.

But while we're on the subject, if your concern is the deficit and you don't want to pay more, who should?

They should create tax for being liberal... Liberals are always for raising taxes so they won't mine.

[BlueK]

Neither does the tax bill.

But while we're on the subject, if your concern is the deficit and you don't want to pay more, who should?

my preference would be to eliminate income tax altogether. Then tax on consumption instead. I wouldn't be opposed to paying my fair share of that kind of tax if I'm chewing up resources.

[beefytee]

They should create tax for being liberal... Liberals are always for raising taxes so they won't mine.

I thought that's what this tax bill does?

https://www.bloomberg.com/news/artic...liberal-tenets

[Northwestcoug]

Neither does the tax bill.

But while we're on the subject, if your concern is the deficit and you don't want to pay more, who should?

Wait, what?

I understand forecasts can swing dramatically based on different scenarios, but isn't 1 trillion dollars the official estimate?

[falafel]

My typos don't add $1 trillion to the deficit.

No way to know that for sure. Have you read the 400 page #GOPTaxScam bill?

[frank ryan]

Wait, what?

I understand forecasts can swing dramatically based on different scenarios, but isn't 1 trillion dollars the official estimate?

I thought it was even more than that.

[BlueK]

No way to know that for sure. Have you read the 400 page #GOPTaxScam bill?

No. Neither will anyone who votes on it.

[Moliere]

No. Neither will anyone who votes on it.

Why do they have to read it? It’s a bunch of legalese. If they want to eliminate AMT they don’t need to read all the legalese saying they are going to remove such and such section of the IRC.

The official estimate I saw was that it would add $1 trillion to the deficit. That projection isn’t accurate. In fact, practically no estimate over 2-3 years is accurate.


Sent from my iPhone using Tapatalk

[Uncle Ted]

I thought that's what this tax bill does?

https://www.bloomberg.com/news/artic...liberal-tenets

Excellent! Democrats should be happy about this bill.

[cowboy]

I thought it was even more than that.

It's $1.4-$1.7 trillion...over ten years...if nothing changes. In other words, if people invest as normal and the tax rates create no GDP growth, the deficit will increase by around $150 billion. And then they multiply that by the magic number 10 because they need to multiply it by something. That way, tax increases sound better and tax cuts sound worse.

Over a 2-year period, the CBO does a decent job with projections, but beyond that, a monkey throwing a dart could guess the true effect of things better. This is partly because long-term projections are nearly impossible, and partly because a lot of legislation is written to game the 10-year time window.

As I've said before, there is very little correlation between tax rates and tax receipts. Taken to extremes, there obviously would be, but this change isn't extreme. The likely long-term effect is going to depend on how the rate change effects growth because receipts will continue to be a function GDP growth.

[Jeff Lebowski]

It's $1.4-$1.7 trillion...over ten years...if nothing changes. In other words, if people invest as normal and the tax rates create no GDP growth, the deficit will increase by around $150 billion. And then they multiply that by the magic number 10 because they need to multiply it by something. That way, tax increases sound better and tax cuts sound worse.

Over a 2-year period, the CBO does a decent job with projections, but beyond that, a monkey throwing a dart could guess the true effect of things better. This is partly because long-term projections are nearly impossible, and partly because a lot of legislation is written to game the 10-year time window.

As I've said before, there is very little correlation between tax rates and tax receipts. Taken to extremes, there obviously would be, but this change isn't extreme. The likely long-term effect is going to depend on how the rate change effects growth because receipts will continue to be a function GDP growth.

Wow. That is some impressive spin.

They project it over 10 years because that is required by law. Don't kid yourself, it is a big number either way. And some people thing the real number is bigger.

Yes, taken to the extreme a tax cut would have to raise the deficit. Between the extremes, it could increase or decrease the deficit. Saying "there is very little correlation between tax rates and tax receipts" is a clever way of admitting that we don't know where we are on that curve. But it is a Republican article of faith that a tax cut always magically results in revenue growth that outstrips the revenue loss. Let's just spend that money and hope for the best!

President Trump and congressional Republicans talk about their tax overhaul plan as if it’s a sure-fire bet for the economy.Far from it. There's little historical evidence that tax cuts actually pay off in boosting economic growth long-term.
And today's combination of high federal debt and a tight labor market casts even more doubt on whether tax cuts will stimulate growth.

To bolster its case, the White House last month cited President Reagan's massive cuts in 1986 and the effect they had over the following 10 years. Yet U.S. economic growth, as well as gains in jobs and income per person, was actually stronger in the decade before the Reagan tax change.A corporate tax cut "isn't by itself enough to make a dent in the growth rate," said Joel Slemrod, co-author of the book "Taxing Ourselves," which reviewed linkages between taxes and growth going back to the late 19th century.
What's more, there are two realities in today's economy that are likely to weigh against the potential benefits of substantial tax cuts. First, the gross national debt -- nearly $19 trillion — is far larger than when Reagan or his successors tried the strategy. Second, the domestic labor market is much tighter, with unemployment at a 17-year low.
Although details of the GOP tax plan are still being negotiated, the White House framework would likely add significantly to the national debt — about $2.4 trillion over 10 years, according to the nonpartisan think tank Tax Policy Center.
Adding to that debt, most economists agree, would largely negate any growth gains from tax relief.

http://beta.latimes.com/business/la-...018-story.html

[Uncle Ted]

Europe is warning us to not pass the tax bill!




They are really worried about our welfare.

[cowboy]

Wow. That is some impressive spin.

They project it over 10 years because that is required by law. Don't kid yourself, it is a big number either way. And some people thing the real number is bigger.

Yes, taken to the extreme a tax cut would have to raise the deficit. Between the extremes, it could increase or decrease the deficit. Saying "there is very little correlation between tax rates and tax receipts" is a clever way of admitting that we don't know where we are on that curve. But it is a Republican article of faith that a tax cut always magically results in revenue growth that outstrips the revenue loss. Let's just spend that money and hope for the best!







http://beta.latimes.com/business/la-...018-story.html

Wow. And you call me condescending.

I don't like the tax bill, and I've said it from the start. I don't think it will spur economic growth as much as other tax reforms could, and I'm certainly not saying it will pay for itself. But to say it will have no offsetting economic effect is a stretch. The CBO didn't use a dynamic scoring method in this estimate, ie they didn't consider the tax revenues from economic growth, the the price tag will be somewhere south of their predictions. The breakeven growth increase on this bill is somewhere around .75%.

Increasing GDP growth from 2% to 2.75% isn't likely, but it isn't out of the question, either. While the labor pool is growing more slowly, I don't believe it is as much a limiting factor as others may. The economy can continue to expand at full employment with productivity increases. Investor confidence is a far larger factor than labor pool in economic growth, imo.

[Jeff Lebowski]

Wow. And you call me condescending.

Sheesh. Like clockwork. You are way too sensitive.

I don't like the tax bill, and I've said it from the start. I don't think it will spur economic growth as much as other tax reforms could, and I'm certainly not saying it will pay for itself. But to say it will have no offsetting economic effect is a stretch. The CBO didn't use a dynamic scoring method in this estimate, ie they didn't consider the tax revenues from economic growth, the the price tag will be somewhere south of their predictions. The breakeven growth increase on this bill is somewhere around .75%.

Increasing GDP growth from 2% to 2.75% isn't likely, but it isn't out of the question, either. While the labor pool is growing more slowly, I don't believe it is as much a limiting factor as others may. The economy can continue to expand at full employment with productivity increases. Investor confidence is a far larger factor than labor pool in economic growth, imo.

Even the WSJ is calling this a budget buster.