Historical Day For The American Nation: The 'Tax Cuts And Jobs Act' Was Signed By The Senate
The world is slowly emerging from the financial crisis, and governments all over the world are changing their economic policies. President Trump will be signing the long-awaited 'Tax Cuts and Jobs Act' that was proposed by the Republicans.
What is the 'Tax Cuts and Jobs Act'?
Proposed by the Republicans, the Act was signed on December 20th, 2017 by the Senat. It is basically a structural overhaul of the tax system but one of the largest ever. Effectively, it means a $1.3 trillion tax cut, and you can understand why it was named a historic day. This huge sum of money will have positive life-altering consequences on the American people.
It is all about cutting income tax rates, doubling the standard deduction, and eliminating personal exemptions. Also, it lowers corporate tax rate to its lowest point since 1939 and offers many other benefits aimed for large corporations.
Imagined as a ten-year plan, the Act will gradually revert the tax for people to its current status. However, the corporate changes are permanent.
How will it affect the economy?
The Republicans are happy to announce that the Bill will have a purely positive effect on the economy. Since the Act will actually save companies a lot more money than individuals, there are several ways the economy will grow. For example, large businesses will be able to return their money to the US instead of using offshore solutions, which don't benefit the country.
Although some are worried that this will raise America's overall debt, Trump and his associates are confident in their decision. In fact, they believe that the GDP will rise by 0.7% after 10 years.
How will it affect you?
As it is with most laws and acts, the middle and lower class are rarely the ones that are getting treated the best. However, there are some advantages even for the little guys.
Apart from doubling the tax deduction, the Act expands the tax deduction for medical expenses. Furthermore, saving money might be an incentive for the companies to invest more, therefore creating new jobs.
This all sound really great, but only time will tell whether or not these reforms are right for the US. Until then, we can just hope that this isn't a marketing ploy by Donald Trump but a sincere improvement for the American nation.