Odd Lots The Big Tax Hike Coming in Just Over a Year
Oct 3, 2024
In this conversation, Kevin Brady, former Chairman of the House Ways and Means Committee and architect of the Tax Cuts and Jobs Act, delves into the complexities of U.S. tax reforms. He discusses the looming tax increases set for 2026 and the necessity for bipartisan cooperation to navigate these changes. Brady reflects on how tax cuts can drive economic growth while addressing income inequality. He sheds light on the political dynamics shaping future tax policies, emphasizing the importance of preserving crucial business tax credits for middle-class families.
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Tax Cuts and Jobs Act Goals
- The Tax Cuts and Jobs Act of 2017 aimed to modernize the outdated US tax code, boost economic growth, and enhance American competitiveness.
- It involved lowering the corporate tax rate and individual income tax rates, and simplifying the tax filing process.
Key Changes of the TCJA
- Key changes in the TCJA included corporate tax cuts from 35% to 21%, individual tax cuts across the board, and a new small business deduction.
- It also involved changes to the SALT deduction, child tax credit, and the elimination of the Alternative Minimum Tax (AMT).
Border Adjustment Tax
- Initially, the TCJA architects considered a border adjustment tax to simplify international taxation.
- However, opposition from import-heavy industries led to its abandonment due to time constraints.