Monday, December 04, 2017

The Middle Class Tax Cut Challenge

It is true, dear readers, that I have a Ph.D in economics, but that doesn't really give me any special insight into the tax code. Reporters should talk to accountants, not economists, about this stuff, much more than they do. But I'll still take this challenge.

There are 7 personal income tax brackets in the US. Lower the rate by 1 point in every single one of them. I'm pretty sure this would do it. If not, adjust a few deduction phaseouts upwards. Are there some bizarre quirks in the tax code that this doesn't cover? I don't know, maybe. Hard to imagine but I guess it is possible. I am not an accountant! Fine, insert a "if your tax bill is greater than or equal to what it would have been under last year's tax code, you owe precisely one dollar less than whatever the new tax code says you owe" line into the tax code.

You could even fit this on a napkin in crayon, as is the legislative custom.

This covers everyone, obviously, not just the middle class, but I don't want to get into a metaphysical debate about what "middle class" means..