Trump tax plan gives a bigger tax cut to foreign investors than middle class Americans
President Donald Trump’s tax plan fulfills a request the GOP establishment has long wanted: a significantly lowered corporate tax rate.
Under the joint GOP-Trump tax plan, the corporate tax rate will be lowered from 35 percent to 20 percent. Supporters of this measure argue that a low corporate tax rate is needed to make U.S. companies more competitive across the globe.
In speeches pitching his tax plan to the country, Trump claims the U.S. has the highest corporate tax rate in the world, even though the truth is more complicated than that. He and other Republicans also argue that a lower corporate tax rate would create more jobs because corporations will use the money that is no longer tied up in taxes to create more jobs and higher wages. However, multiple studies have shown that this won’t be the case.
According to new analysis from Steven Rosenthal, a senior fellow at the Urban-Brookings Tax Policy Center, the only group significantly benefiting from a lowered corporate tax rate are wealthy foreign investors.
Analysis by Rosenthal finds that roughly 35 percent of U.S. corporate stock is owned by foreign investors. Slashing the corporate tax rate to 20 percent would translate to a tax cut for these investors worth $70 billion dollars, a cut three times the tax break that households in the middle income quintile would get under Trump’s tax plan.
https://thinkprogress.org/gop-tax-plan-would-give-foreign-investors-a-70-billion-dollar-tax-cut-9aade44d50ab/
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