Wednesday, September 30, 2015

The Tax Foundation says Trump tax plan will blow up the deficit, reducing revenues to 12% of GDP

From Alan Cole, here:

"Looking at these rates, collectively, note that Mr. Trump is frequently cutting rates in half, and sometimes cutting them by even more than that. Taken together, these rate reductions are enough—by my estimates—to reduce tax collections from about 18 percent of GDP to about 12 percent. Under rates as low as these, economic growth—moderate or otherwise—cannot restore federal revenues to current-law levels.

"Tax cuts can do a great deal of good; each of the provisions I outlined above could help a lot of people lead better lives. However, the reductions in federal revenue need to be acknowledged, and likely mitigated through substantial cuts in spending, in order to make this plan feasible."