The GOP's rush to pass tax cuts will leave huge loopholes, tax experts warn
President Trump says, dubiously, that Republicans are preparing to pass the largest tax cut in U.S. history, but even if that's not quite true, it is incontrovertible that Republicans are trying to push through major tax overhauls at breakneck speed, at least by congressional standards. Neither of the bills are finalized, though House Republicans plan to pass their bill Thursday or Friday, and Trump publicly made suggested changes as recently as Monday. The Congressional Budget Office said Monday that the official congressional tax analysts at the Joint Committee on Taxation haven't had enough time to analyze the full economic impact of the bills.
"The rush to 'get it done' — particularly on the business side, where the most sweeping changes are planned — is alarming tax specialists who warn that new and unforeseen complexity, loopholes, and glitches could come back to haunt tax collectors and taxpayers," says The New York Times, pointing out several "loopholes and tax dodges spotted so far — whether unintended or not." The loopholes could allow small and medium businesses to take advantage of offshore tax shelters, wealthy hedge fund investors could claim lower tax rates intended for pass-through businesses, and other provisions, anodyne on their own, would open up new tax dodges.
"There is not a single advantage this has, except for students of people like me, who will get paid more to figure out how to game the system," Steven Rosenthal at the nonpartisan Tax Policy Center, formerly with the Joint Committee on Taxation, tells The New York Times about one of the provisions. The Tax Policy Center estimates that half of the net tax cuts would go to the top 1 percent of earners. Supporters of the tax bills say the legislation will be imperfect but can be fixed once enshrined in law.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.
Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
Create an account with the same email registered to your subscription to unlock access.
Sign up for Today's Best Articles in your inbox
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
Peter has worked as a news and culture writer and editor at The Week since the site's launch in 2008. He covers politics, world affairs, religion and cultural currents. His journalism career began as a copy editor at a financial newswire and has included editorial positions at The New York Times Magazine, Facts on File, and Oregon State University.
-
Government shutdown looming? Blame the border
Talking Points Democrats and Republicans say funding for immigration enforcement is the budget battle's latest sticking point. That's about all they agree on.
By Rafi Schwartz, The Week US Published
-
'Conservatives have not limited their attack on reproductive rights to the US'
Instant Opinion Opinion, comment and editorials of the day
By Harold Maass, The Week US Published
-
Housing costs: the root of US economic malaise?
speed read Many voters are troubled by the housing affordability crisis
By Peter Weber, The Week US Published
-
Housing costs: the root of US economic malaise?
speed read Many voters are troubled by the housing affordability crisis
By Peter Weber, The Week US Published
-
Feds cap credit card late fees at $8
speed read The Consumer Financial Protection Bureau finalized a rule to save households an estimated $10 billion a year
By Peter Weber, The Week US Published
-
Immigration helped the US economy outpace peers
speed read The U.S. economy grew at an annualized rate of 3.2% last quarter
By Peter Weber, The Week US Published
-
4-day workweek gets boost from UK study
Speed Read Following a six-month trial, the majority of participating British companies are still using the truncated schedule
By Peter Weber, The Week US Published
-
US sues to block Kroger-Albertsons merger
Speed Read The Federal Trade Commission sued to block the $24.6 billion merger between the grocery giants
By Peter Weber, The Week US Published
-
Nvidia sees historic stock rise on AI chips success
Speed Read U.S. chipmaker Nvidia achieved the biggest one-day increase in value of any company in history
By Peter Weber, The Week US Published
-
New York may seize Trump's assets for $450M penalty
Speed Read The former president likely owes $600 million from two civil judgments in New York
By Peter Weber, The Week US Published
-
Capital One to buy Discover for $35B
Speed Read The deal, if cleared by regulators, would create the biggest credit card lender in the country
By Peter Weber, The Week US Published