The GOP tax framework unveiled this week would spread tax cuts across all income groups, with the richest Americans seeing the biggest windfall.
And, if enacted, the package would blow a $2.4 trillion hole in the federal budget.
That’s the finding of an analysis by the Tax Policy Center, which crunched the numbers to come up with a preliminary estimate of the plan’s costs and beneficiaries.
The biggest winner would be the richest 1 percent of U.S. taxpayers, who would get more than half of the benefits of the plan, according to the center.
President Donald Trump praised the plan Friday as a “giant, beautiful, massive, the biggest ever in our country, tax cut.” He said it would help American businesses and workers “thrive, compete and grow.”
But the analysis released Friday found that, over time, the plan would increase the tax burden on about 28 percent of the middle-class workers Trump has pledged to help.
“Someone needs to honestly explain to working-class households why they’d want to get anywhere near this thing,” said Jared Bernstein, a former chief economist to Vice President Joe Biden.
Much about the proposed tax plan has yet to be finalized, including the income cutoffs for three new tax brackets that will replace the current seven marginal rates. The nine-page “framework” released Wednesday also calls for eliminating many popular tax deductions, but it stopped short of spelling out exactly which ones would be repealed.
As a result, the Tax Policy Center analysis made a series of assumptions about the impact of the provisions that have not been spelled out. The analysis also did not take into account any future economic impact, a process known as “dynamic scoring,” that GOP proponents say will generate higher revenues and reduce the impact on the federal deficit.
Based on the available details, the center estimates that the top 1 percent of households, or those making more than $730,000, will get an 8.5 percent tax windfall — or about half of the total cuts provided by the plan.