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Trump wants to lower corporate income tax rate to 15%. I'm mystified how thinks he can pay for even a 28% rate. politico.com/story/2017/09/… 1/11
In 2011 JCT estimated if repeal all tax benefits, revenue raised from C corps can only pay to lower CIT rate to 28%. democrats-waysandmeans.house.gov/sites/democrat…
Rs have already taken repeal of most of these tax expenditures (e.g., accelerated depreciation, R&D expensing) off the table. 3/11
Means only enough tax expenditures left to pay for lowering the corporate income tax rate to 34% or 33%. 4/11
Plus, Trump and House Rs are proposing to expand many corporate tax expenditures, like moving to expensing. 5/11
Expensing might be roughly revenue neutral if disallow interest deds. But Trump and Rs backing away from this, so likely loses revenue. 6/11
Trump and House Rs also proposing moving to territorial international system, which would cost 100s of billions. 7/11
Have proposed no base erosion provisions to offset the cost other than the BAT, which they have withdrawn. 8/11
So realistically, even setting aside the proposed rate cut, Trump and House R corporate tax proposals cost money. 9/11
That means Trump and House Rs need to *raise* the corporate income tax rate to pay for their other corporate tax proposals. 10/11
The only alternatives (1) make individual TPs pay for corporate rate cut, (2) make passthrus pay, (3) massively increase deficits. 11/11
