{"id":7200,"date":"2024-11-02T19:03:06","date_gmt":"2024-11-02T19:03:06","guid":{"rendered":"https:\/\/finderica.com\/the-polar-opposite-tax-policies-of-harris-and-trump\/"},"modified":"2024-11-02T19:03:06","modified_gmt":"2024-11-02T19:03:06","slug":"the-polar-opposite-tax-policies-of-harris-and-trump","status":"publish","type":"post","link":"https:\/\/finderica.com\/?p=7200","title":{"rendered":"The Polar Opposite Tax Policies Of Harris And Trump"},"content":{"rendered":"\n
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Democratic presidential candidate Kamala Harris (R) shakes hands with Republican presidential … [+]<\/span> candidate Donald Trump during a presidential debate in Philadelphia, Pennsylvania, on September 10, 2024. (Photo by SAUL LOEB \/ AFP) (Photo by SAUL LOEB\/AFP via Getty Images)<\/span><\/p>\n

<\/fbs-accordion>AFP via Getty Images<\/small><\/figcaption><\/figure>\n

In many ways, Donald Trump and Kamala Harris have drawn tax policy maps that are mirror images of one another. While a few ideas overlap, the two candidates could not be charting more divergent tax policy paths.<\/p>\n

Vice President Harris\u2019s tax proposals<\/a> generally fit within a well-defined framework. She backs tax cuts for low- and moderate-income households.<\/a> And she especially favors families with children. Many of her initiatives fit within her \u201ccaring economy\u201d model (see here<\/a> and here<\/a>).<\/p>\n

At the same time, she\u2019d raise taxes on high-income households and corporations. With one big exception, she\u2019d stay well within the boundaries of the current income tax system.<\/p>\n

Former President Trump, on the other hand, has proposed a long list of highly targeted tax cuts aimed at specific, but disparate, constituencies. Paired with his aggressive tariff proposals, they show a candidate coloring far outside the lines of the income tax.<\/p>\n

In many cases, Harris and Trump have left out key policy details, making it tough to understand exactly what they are proposing. Still, it isn\u2019t hard to identify the stark contrasts. Here are just some of the ways they differ:<\/p>\n

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The future of the income tax. <\/strong>While Harris has proposed many targeted tax cuts, none threaten the stability of the current income tax. But to help pay for her costly agenda, she seems to recognize some revenue needs to come from elsewhere. So, like President Biden,<\/a> she has proposed a tax on the increased value of unsold assets of very wealthy households. That would be a big change from the existing income tax system that generally taxes increases in asset values only after they are sold.<\/p>\n

Trump, by contrast, would blow a major hole in the income tax. He\u2019d slash the corporate income tax rate and exempt wide swaths of income from the individual income tax. The Committee for a Responsible Federal Budget estimates<\/a> Trump\u2019s tax cuts would reduce federal revenues by about $9.5 trillion over the next decade, about one-quarter of projected individual income and corporate income tax revenues.<\/a><\/p>\n

Most importantly, he claims he\u2019d replace the income tax with worldwide tariffs<\/a>\u2014an idea that is impossible to achieve<\/a> but sends an important signal about his intentions. Project2025,<\/a> drafted by many former Trump advisers, explicitly calls for replacing the income tax with some form of consumption tax.<\/p>\n

Tax cuts<\/strong>: Trump would exempt from tax income such as tips<\/a>, overtime pay<\/a>, and Social Security benefits<\/a>. He\u2019d cut the corporate tax rate<\/a>. He\u2019d restore deductibility of auto loans for the purchase of vehicles made in America<\/a> and for state and local taxes. He\u2019d create an unspecified tax credit for family caregivers<\/a>. And he\u2019s promised to at least consider exempting from tax income earned by 22 million<\/a> first responders, military personnel, and veterans.<\/p>\n

TPC has found that while Trump touts these tax cuts as support for working families, many would largely benefit those at the top of the income scale (see here<\/a>, here<\/a>, and here<\/a>).<\/p>\n

For her part, Harris would make tip income tax free from those making $75,000 or less and expand the Child Tax Credit (CTC)<\/a> and the Earned Income Tax Credit (EITC)<\/a>. She\u2019s also proposed tax changes for certain homebuyers and homebuilders and for start-up and small businesses. <\/a><\/p>\n

Tax increases<\/strong>: Nowhere do the candidates\u2019 tax plans differ more. Harris would raise the current 21 percent corporate tax rate to 28 percent while Trump would cut the rate to 20 percent for most corporations and 15 percent for those that manufacture their products in the US.<\/a><\/p>\n

For high-income households, Harris would increase the top tax rates on ordinary income and capital gains and impose a 25 percent minimum tax on unrealized capital gains of those with net worth in excess of $100 million.<\/p>\n

Trump has identified only two sources of new tax revenue: His tariffs and full repeal of the green energy provisions of the Inflation Reduction Act, which would save about $700 billion over 10 years. In sharp contrast to Harris, he has proposed no explicit tax increases targeted to those with high incomes.<\/p>\n

Tariffs:<\/strong> Trump has tossed out a dizzying array of tariff ideas. But he most frequently talks about a worldwide tax on imports of either 10 percent or 20 percent, with higher tariffs on Chinese goods. He also suggested he\u2019d exempt certain companies or industries from the tariffs.<\/p>\n

TPC estimates<\/a> that raising the worldwide tariff to 20 percent plus a 60 percent tax on Chinese imports would generate about $4.5 trillion in revenue, after accounting for declines in corporate and individual income taxes caused by falling US incomes. TPC\u2019s estimates exclude any negative economic effects of retaliation by US trade partners subject to the tariff, a highly likely response.<\/p>\n

Harris has largely been silent on tariffs.<\/p>\n

The Tax Cuts and Jobs Act:<\/strong> Most of the individual income tax provisions of the TCJA<\/a> are due to expire at the end of 2025. Trump says he\u2019d make the law permanent. Harris says she\u2019d protect households making $400,000 or less from tax increases when the TCJA provisions expire. But beyond proposing to expand the law\u2019s versions of the CTC and EITC, she\u2019s said little about what other changes she\u2019d make to the TCJA.<\/p>\n

Impact on the budget<\/strong>: The CRFB estimates<\/a> Harris\u2019s tax and spending plans would, on net, add about $4 trillion to the federal debt over the next decade. The group calculates Trump would add almost $8 trillion to the debt. He\u2019d also accelerate Social Security\u2019s insolvency by 3 years, according to CRFB<\/a>.<\/p>\n

Harris and Trump have offered voters dramatic contrast in personalities, worldview, and broad policy issues. Taxes are no exception.<\/p>\n<\/div>\n

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Democratic presidential candidate Kamala Harris (R) shakes hands with Republican presidential … [+] candidate Donald Trump during a presidential debate in Philadelphia, Pennsylvania, on September 10, 2024. (Photo by SAUL LOEB \/ AFP) (Photo by SAUL LOEB\/AFP via Getty Images) AFP via Getty Images In many ways, Donald Trump and Kamala Harris have drawn tax<\/p>\n","protected":false},"author":1,"featured_media":7201,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rank_math_lock_modified_date":false,"footnotes":""},"categories":[196],"tags":[562,1976,374,97,563],"class_list":{"0":"post-7200","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-finance-news","8":"tag-harris","9":"tag-polar","10":"tag-policies","11":"tag-tax","12":"tag-trump"},"_links":{"self":[{"href":"https:\/\/finderica.com\/index.php?rest_route=\/wp\/v2\/posts\/7200","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/finderica.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/finderica.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/finderica.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/finderica.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=7200"}],"version-history":[{"count":0,"href":"https:\/\/finderica.com\/index.php?rest_route=\/wp\/v2\/posts\/7200\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/finderica.com\/index.php?rest_route=\/wp\/v2\/media\/7201"}],"wp:attachment":[{"href":"https:\/\/finderica.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=7200"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/finderica.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=7200"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/finderica.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=7200"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}