JIMMY GRAHAM | email@example.com
In late December of 2017 the Tax Cuts and Jobs Act, also known as the GOP Tax Plan, was signed into law. This policy so far has helped put more money in the pockets of hard working Americans. It also has helped businesses in raising wages and expanding.
How individuals are affected
Under this new tax plan, individuals are taxed less on their wages. This plan lowers taxes roughly 2%-3% for most tax brackets. For instance, a married couple bringing in $77,400-$165,000 a year in 2017’s tax rate would be 25%. Under the new tax policy that rate is lowered to 22%. A 2%-3% decrease in income taxes may not seem like a huge change, but that amount that is saved in wages in just one year adds up to a significant amount of money. For Example, a family making $80,000 a year will save $2,400 a year. This amount that is saved can mean a lot to hard working Americans. Many can use this extra money toward things such as rent, utility bills, or even toward their children’s education.
How businesses are affected
Prior to the Tax Cuts and Jobs Act, the corporate tax rate for most businesses was at roughly 35%. Currently under this new plan it has been lowered to 21%. Due to this large cut to many large companies have used this as an opportunity to give bonuses to their employees. Companies such as AT&T, AAON, and American Airline have awarded many of their employees with $1,000 bonuses. Many companies have also used this tax cut to raise wages for their employees. One instance of this is Associated Bank raising its base wage from $10 to $15 per hour. On top of raising wages and giving bonuses many are also using this tax break to expand their businesses. Boeing and Comcast for example are using $100 millions of its tax break to expand their infrastructure and facilities.
How to make these cuts permanent
Unfortunately, because this bill was passed through congress with only a slim margin, it can only be in effect until 2025. In order for this to be permanent congress would have to get a wider majority of votes. The only way for there to be a wider majority would be for congress to put aside partisan differences and give this bill bipartisan support.
Jimmy Graham is a sophomore majoring in business management and is political director of College Republicans.