The center’s analysis included Clinton’s latest proposal -- doubling the child tax credit to $2,000 per child for eligible families who have children age 4 and under and expanding the amount of the credit that can be paid as a refund to those who owe no income tax. Clinton’s campaign announced the change Tuesday, but didn’t cite a cost -- which the tax-policy center’s report pegged at $208.7 billion over 10 years.
‘Down Payment’
In a news release, Clinton’s campaign described the proposed expansion of the credit as “a down payment on further relief for middle-class families.” Asked if policy analysts expect Clinton to announce more proposals to benefit the middle class, Burman, the tax-policy center’s director, said: “My assumption is, this is the middle-class tax cut.”
For Trump, the center found more after-tax gains for all income levels -- but far more for those at the top. In the first year of his plan, the bottom 20 percent of taxpayers would see an average cut of $110, and those whose incomes rank them between the 60th and 80th percentiles would get an average cut of $2,030, according to the report. Meanwhile, the top 1 percent would get an average cut of $214,690 and the top 0.1 percent would get an average cut of $1,066,460, the analysis found.
Most individual filers would see at least some increase in their after-tax income, the center found -- though portions of Trump’s plan that repeal personal exemptions and the “head of household” filing status “would cause many large families and single parents to face tax increases,” according to the analysis.
Estate Tax
Trump also proposes slashing the 35 percent corporate tax rate to 15 percent -- his single largest tax cut -- which would reduce federal revenue by almost $2.4 trillion over a decade, according to the center’s report.
One of the more pronounced tax-policy differences between Trump and Clinton involves the estate tax, which currently applies a 40 percent rate to any estate worth more than $5.45 million. Trump wants to abolish the tax, while Clinton wants to increase it.
Trump’s plan would eliminate estate and gift taxes, the center’s report said -- but it would tax capital gains above $5 million (or $10 million for married couples) at death. His changes would reduce federal revenue collections by $174.2 billion over 10 years.
Clinton wants to increase the estate tax rate to 45 percent and apply it to estates worth more than $3.5 million. For estates worth more than $10 million, the rate would increase to 50 percent; above $50 million, the rate would be 55 percent; and above $500 million, the rate would be 65 percent. Her estate-tax proposal would raise $410.4 billion over 10 years, according to the center’s analysis.
This article was provided by Bloomberg News.