Charlotte Talks: The Tax Cuts And Jobs Act
Thursday, Feb. 6, 2020
Just over two years ago Trump passed a comprehensive tax cut. It’s the signature legislative achievement of his administration, but who has profited the most?
“It will be rocket fuel for our economy,” stated President Trump, referring to the 2017 Tax Cuts and Jobs Act. The crown jewel of the law was a cut in the corporate tax rate, from 35% to 21%.
Higher wages, business development and jobs were expected to surge. American wage gains grew from the average 2.1% to 3.3% in 2018, approximately 140 million American families experienced federal tax savings and for the first time in decades there are more job openings than Americans looking for work, according to the White House.
Lower taxes also mean less government revenue. Despite claims the tax would “pay for itself,” the budget deficit has increased nearly 50% since Trump took office – it’s expected to top 1 trillion this year. The economy grew only 2.9% in 2019, the exact amount of growth in 2015. Over 60% of the tax savings went to people in the top 20% of the income ladder, and some billion-dollar companies, such as FedEx, reduced its tax rate so far that the government technically owed it money.
Two years since Trump’s signature tax rehaul, we analyze the profound impact on both Charlotte and our nation as a whole.
Jared Bernstein, Senior Fellow at Center on Budget Policy and Priorities
Becki Gray, Senior Vice President at John Locke Foundation
Danielle Chemtob, Growth and Development Reporter at Charlotte Observer