His proposal would completely eliminate corporate taxes. That goes much further than other candidates, who have all so far proposed simply lowering the corporate tax rate. It’s currently 35 percent on paper, although corporations already use a variety of loopholes, breaks, and accounting mechanisms to pay an effective rate under 20 percent.
He would also eliminate the estate tax, something proposed by other candidates, which is only paid by the richest 0.14 percent of Americans. Yet it is still a very progressive and significant source of government revenue, since it would generate $246 billion over the next decade from those who can most afford to pay it.
At the same time, a big goal of Jindal’s tax plan is ensuring that all citizens pay at least some federal income tax. About 45 percent of Americans owe no income tax — although they still often pay payroll taxes to Social Security and Medicare and will also pay state and local sales taxes — and about half of those households simply don’t make enough money. The others usually qualify for credits and deductions that bring their tax burdens down to zero. While Jindal would keep the Earned Income Tax Credit, a key way many low-income households end up owing no taxes, it’s unclear if they would still have to pay.
“We simply must require that every American has some skin in this game,” Jindal said of his plan in a statement to the Wall Street Journal. “If we have generations of Americans who never pay any taxes, it will be very easy for them to turn a blind eye to absurd government spending and to continue to allow our government to bankrupt our nation.”
That part of his plan also differs sharply from those released by other candidates. While both plans from Jeb Bush and Donald Trump would overwhelmingly benefit the wealthy, they still include proposals that would actually increase the number of Americans who don’t owe income tax.
Original Article
Source: thinkprogress.org/
Author: Bryce Covert
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