The House Republican Tax Reform blueprint would lead to 9.1 percent higher GDP growth, 7.7 percent higher wages, and create 1.7 million new jobs, according to an analysis by Kyle Pomerleau of the Tax Foundation. This pro-growth plan, released under the leadership of Speaker Paul Ryan (R-Wis.) and House Ways and Means Chairman Kevin Brady (R-Texas) cuts taxes for ALL American families and businesses, simplifies the code, promotes strong economic growth, and allows our businesses to better compete against foreign competitors.
According to the Tax Foundation analysis, the plan cuts taxes by $2.4 trillion over the next decade. However, due to the more than 9 percent economic growth, the plan would result in federal revenue losses of just $191 billion over the same period.
On the individual side, the GOP blueprint calls for cutting taxes across the board by consolidating the existing seven tax brackets into three brackets – 12 percent, 25 percent, and 33 percent. The analysis finds that this would result in a $2 trillion tax cut for American families, while also boosting GDP by 1.5 percent.
The plan also cuts the corporate income tax rate from 35 percent to 20 percent and the tax rate on pass-through entities from more than 40 percent to just 25 percent. According to the Tax Foundation, this would cut taxes by more than $1.7 trillion over ten years and directly lead to GDP growth of more than 2 percent.
The tax blueprint also simplifies the system through repeal of the Death Tax (raising $20 billion according to the analysis), repeal of business tax credits (raising $677 billion), eliminating itemized deductions except for homeownership and charitable giving (raising $2.2 trillion), and eliminating the AMT (cutting taxes by $428 billion). While may of these provisions increase taxes in isolation, they are more than offset by corresponding tax cuts in the blueprint.