- Republicans released their long-awaited tax reform bill on Thursday.
- The Wall Street Journal’s editorial board said that while the bill has positive reforms on the corporate side, it does not do enough on the individual side.
- The board believes that the current plan favours the poor at the expense of the wealthy.
The Tax Policy Center, in analysing the Republican framework for tax reform released in September, determined that 80% of its benefits would go toward to the ultra-wealthy.
But the Wall Street Journal’s editorial board says the legislation would come down hard on the rich while favouring less-well-off Americans.
In a breakdown of the legislation, the editorial board praised its proposed corporate reforms but complained about proposed changes to the individual side.
“The Ways and Means draft is instead a much-needed and pro-growth reform of business taxes marred by a mess on individual taxes that makes that part of the code even worse than it is now,” the editorial reads.
The editorial board wrote that a slew of provisions that would reduce taxes on the low end — like the doubling of the standard deduction — place the onus of taxes too heavily on the wealthy. And it said other items in the tax bill, like the increased child credit, would be “a forlorn attempt to appease the income redistributionists,” especially since the credit would phase out above an income level of $US230,000 for married couples.
The board also said House Republicans kept the top rate at 39.6% for the wealthiest earners because they were bending to pressure from Democrats and President Donald Trump.
“This top rate is a surrender to Democratic class warriors, though Republicans also fear that President Trump would sandbag them. No Members want to vote for a lower top rate and then have Mr. Trump tweet that they’re ‘mean,’ as he did on health care.
Overall, the editorial board said that the bill does little to effectively change the tax code for Americans and represented “income redistribution.”
“Kevin Brady and Paul Ryan, the chief House tax writers, understand the weaknesses in their plan,” the editorial board said. “But the GOP is trapped in an iron cage of Beltway process. The party has bowed to the class-warfare crowd that says the bill cannot change the distribution of who pays taxes.”
NOW WATCH: Briefing videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.