The Senate tax proposal is out, along with a Joint Committee on Taxation analysis estimating it will add $1.495 trillion to the deficit over the next decade. Member reaction. The Senate can only afford to lose two GOP votes to pass the bill.
– 7 income tax brackets: 10, 12, 22.5, 25, 32.5, 35, and 38.5 percent
– Repeal of personal exemption
– $1,650 child tax credit
– Repeal of deduction for state and local taxes
An individual taxpayer can deduct 17.4 percent of domestic qualified business income from a partnership, S corporation or sole proprietorship. Most service businesses are excluded.
– 20 percent corporate rate beginning in 2019
– Repatriation rates of 5 percent for illiquid assets, 10 percent for liquid
GOP senators contend the tax system overhaul will ease the burden on middle-income Americans while encouraging companies to boost hiring and wages. Trimming the tax burden on businesses and individuals has long been a Republican goal. With unified control of the White House and both chambers of Congress, the GOP aims to pass a tax reform plan this year, despite lingering challenges.