In what has been declared as ‘one of the biggest tax cuts in American history’, income tax rates on both business and individual categories have been reduced by the Trump administration.
The Trump administration reduced corporate tax rate from 35 per cent to 15 per cent, while the individual tax rates were also lowered and several tax rates such as the death tax was eliminated.
US Treasury Secretary Steven Mnuchin said the the tax cuts would “unlock” the American economy, enhance the businesses, create new job opportunities, and would also help in bringing in huge amount of dollars stacked overseas by the US companies.
Cohen add that the new tax reform package is about economic growth and creating jobs”. The Trump administration proposed to reduce the current seven tax brackets to three tax brackets of 10 per cent, 25 per cent and 35 per cent; aiming to provide tax relief for families burdened with child care expenses.
Working on eliminating different tax breaks which basically benefits the wealthiest taxpayers, the Trump administration has also proposed to quash the Alternative Minimum Tax, the death tax and the 3.8 per cent Obamacare tax.
In addition to a flat 15 per cent business tax rate, the Trump administration proposed territorial tax system to level the playing field for American companies, one-time tax on trillions of dollars held overseas and eliminate tax breaks for special interests.
The Trump administration will be holding listening sessions with stakeholders in May seeking inputs in order to improvise the proposed tax relief step which aims at providing massive tax relief, creating new jobs and making America more competitive.