After numerous revisions and multiple votes, the tax overhaul bill promised by President Trump is making its way to his desk. The House voted again today, and the tally swung in the Republicans’ favor. President Trump has been asking for passage in time for his final signature before Christmas, and it looks like he’s gotten his wish.
“With a 224-201 House vote,” Fox writes, “Congress sent the $1.5 trillion package to Trump’s desk. The biggest rewrite of the federal tax code since the Reagan administration will usher in steep rate cuts for American companies, double the deduction millions of families claim on their annual returns and make a host of other changes taking effect in a matter of weeks.”
Some of those typically critical of anything enacted by the President have even come out with positive critiques of the overhaul.
The Wall Street Journal has published an op-ed in its “Heard on the Street” column. Justin Lahart covers economics for the Wall Street Journal. He has written for CNNMoney and TheStreet.com. Lahart writes:
“There were several surprises for investors when Republicans unveiled their final tax bill Friday, but the most significant is that they add up to a bigger boost to economic growth next year.
“The bigger stimulus could fundamentally change how the market behaves in 2018. Sales and profits will be stronger than most investors expect. But with the unemployment rate low, wage pressures will mount faster, and inflation should pick up more. If the tax plan passes, as seems likely, it could lead the Federal Reserve to raise rates faster, putting the bond market at risk.
“The tax plan was always expected to juice the economy, but the Senate version, which passed after the House approved its bill, had relatively modest short-term stimulus. While the stock market kept rising in anticipation of a cut, the bond market hardly budged. The bill unveiled Friday front-loaded more than $200 billion in stimulus for next year. Economists had been penciling in a boost of about a third of a percentage point next year. Now that is looking way low.
“Some of the pro-growth changes include eliminating any delay to the corporate tax cuts, lowering of the top individual rate, lowering rates for most taxpayers, and increasing the child tax credit. The latter is particularly important because middle-class households are “more likely to spend extra income than the rich.”
Lahart’s conclusion is that the GDP could grow by as much as 1.3 percent. Even though the number there is small, the gain is significant. Earlier projections had the growth well below one percent.
The version that is making its way to the President’s desk now may not spell the doom and gloom the Democratic politicians are predicting.