(The Federalist) -- The U.S. House of Representatives passed a tax reform bill last Thursday called the Tax Cuts and Jobs Act. The legislation would provide a tax cut for many and simplify the tax code by slashing the tax brackets from seven to four and eliminating many exemptions and special breaks. Deeply rooted in Republican orthodoxy, it is exactly the sort of bill you would expect from the GOP of 2017.
While it does simplify and lower marginal rates, both corporate and personal, the bill doubles the current standard deduction of $6,350 (resulting in an average 15 percent increase when eliminated exemptions are taken into account), does not reform the Earned Income Tax Credit (EITC), and expands the Child Tax Credit (CTC) from up to $1,000 per child to $1,600, and adds a new “Family Flexibility Credit.”
Proponents of the bill would say the EITC shouldn’t be touched and that the Child Tax Credit needs to be increased to ensure Americans aren’t paying more in taxes under the plan. That might be true—for people who actually pay income tax.
Advertisement - story continues below