Just last week, the Tax Cuts and Jobs Act was signed by President Trump. It slashes the corporate tax rate from 35 to 21 percent beginning in 2018, and is the biggest tax change in 30 years. While the focus appears to be mostly on big business with this permanent reduction, the American public is left with individual tax changes that expire at the end of 2025, unless Congress takes action.
Individuals will experience lower income tax rates, a doubled standard deduction, and the elimination of personal exemptions. Higher income families will benefit most, as their tax rates are lowered more than others. The Act is predicted to increase national debt, but those in favor are hopeful that it will bring in new revenue. Therefore, it’s possible that the American public will continue to support entitlement spending, but now concern that our long-term economic growth will be damaged has also come into play.