October 22, 2024
CNBC, which is owned and controlled by people who will pay lower taxes with Donald Trump back in the White House, ran a PR piece for Donald Trump’s tax agenda. The piece is headlined “Trump Tax Plans Could Exempt 93 Million Americans From Income Tax.”
The piece highlights several proposals that Trump has thrown out with virtually no specifics, such as exempting firefighters, police, and veterans from taxes as well as overtime wages. It concludes that this could exempt 93 million people from income taxes.
Trump has proposed to offset this lost revenue with taxes on imports. Since most of the people who CNBC now says would be exempt from income tax already pay little or no income tax, they would almost certainly be paying far more money in taxes on imports than they pay now in income tax.
For example, a family of four with an income of $60,000 and two kids, would currently pay nothing in income taxes. We don’t know how high Trump will actually make his import taxes (he keeps throwing out higher numbers), but if we start with his 20 percent and 60 percent on China, this would come to an average of close to 30 percent.
With goods imports at roughly 13 percent of GDP, this would translate into a tax of roughly 4.0 percent. If this family spends all their income this would come to a tax burden of $2,400 a year. This family, as well as most other moderate and middle income families, would fare much worse under the Trump tax plan than the current system.
CNBC has managed to flip reality on its head and imply that these people will somehow be better off with the more regressive tax plan Trump is putting forward. It is unfortunate that they could not present the views of someone familiar with the tax code.
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