A much-anticipated tax code overhaul has been released by House Republicans, and it would cut the corporate tax rate from 35% to 20% as lawmakers promised in September.
The Tax Cuts and Jobs Act would make that 20% corporate tax rate permanent and instate it immediately upon the bill becoming law, as opposed to phasing it in over a period of years as was being discussed by lawmakers in recent weeks. The bill would also create a new global 10% tax on high-profit foreign subsidiaries of U.S.-based companies, to prevent those organizations from stowing profits away overseas.
The proposed tax bill would create a new 25% tax rate for pass-through businesses, as opposed to being taxed an individual rate as they are currently.
The draft includes a higher individual rate for the nation’s wealthiest taxpayers than was originally proposed in September, with a 39.6% rate to reportedly apply to married couples making over $1 million annually. Three new individual tax brackets are also included in the plan: A 12% rate on incomes up to $45,000 for an individual and $90,000 for a married couple, a 25% rate on incomes up to $200,000 for and individual and $260,000 for couples, and a 35% rate on incomes up to $500,000 for an individual and $1 million for couples.
Here’s a roundup of initial reactions to the plan released this morning:
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