What is in the Republican tax plan and spending plan
Republicans in Congress are advancing a sweeping package of budget cuts and spending reductions that would meet President Donald Trump's demands. However, details need to be worked out.
The Joint Committee on Taxation (JCT) and the Congressional Budget Office have estimated the impact of this plan on the budget for the next ten years.
Tax Cuts and Exemptions
(Cost: $2.2 trillion) Makes permanent lower income tax rates that were set to expire in Trump's Tax Cuts and Jobs Act of 2017. (Cost: $2.2 trillion)
Increases the alternative minimum tax exemption. (Cost: $1.4 trillion)
(Cost: $1.3 trillion) Increases the standard deduction by $1,000 up to $1,500. (Cost: $1.3 trillion)
Increases tax breaks for "pass-through businesses" such as sole proprietorships, LLCs, and partnerships (Cost: 809 billion dollars)
Increases the Child Tax Credit from $1,000 to $2,500 until 2029 and then keeps it at $2,000, indexes to inflation. (Cost: $797 billion)
Raising the exemption for estate taxes from $14 to $15 million. (Cost: $212 billion)
Extends tax benefits for multinational corporations. (Cost: $174 billion)
Tax exemptions on overtime pay through 2029. (Cost: $124 billion)
Other 2017 tax breaks for business are extended. (Cost: $99 billion)
Creates new $4,000 deductions for seniors. (Cost: $72 billion)
Tax exemptions on interest payments for loans to domestic autos up until 2029. (Cost: $58 billion)
Tax exemptions on certain tipped income until the year 2029. (Cost: $40 billion)
Contributions to private school scholarship funds are exempt up to $5,000. (Cost: $20.4 billion)
Parents can contribute up to $5k tax-free per year to "MAGA Accounts", which they can use to pay for their child's education and other expenses when they become adults. (Cost: $17.2 billion)
Taxpayers can now deduct upto $30,000 in state and local taxes, instead of the current $10,000. (Revenues increased compared to the pre-2017 tax code when there was no limitation: $916 billion).
SAVINGS AND NEW REVENUES
Extended 2017 deadline for the elimination of personal exemption deduction. (Savings: $1.9 trillion)
Tax breaks for green energy, electric vehicles and clean electricity are eliminated. Tax breaks for nuclear energy will be phased out starting in 2029. (Savings: $916 billion)
Restriction of health benefits for certain immigrants. (Savings: $117 billion)
Increases eligibility requirements for Affordable Care Act Exchange coverage. (Savings: $82 billion)
Taxes on private university endowments are raised from 1.4% up to 21%. (New revenue: $22.6 billion)
Imposes a new tax of 5% on money sent home by immigrants. (New revenue: $22.2 billion)
Taxes on
Purchase of firearm silencers
. (Cost: $1.4 billion)
Gives the government the power to end the tax-exempt status of "terrorist-supporting organizations."
Total cost of tax cuts: $5.6 TRILLION
MEDICAID
Adults who are able-bodied and do not have dependents must work, volunteer or attend school for at least 80 hours per month beginning in 2029.
The verification process is strengthened to ensure that participants and healthcare providers can participate. Rules that facilitate enrollment are removed.
The program excludes non-citizens and penalizes the states who use their own money to cover illegal immigrants.
The regulations that require minimum staffing in nursing homes and long-term care facilities have been blocked.
Funding for gender-transition therapies for minors is prohibited.
Prohibit payments to large providers such as Planned Parenthood who specialize in birth control and reproductive health services.
Limit state taxes on providers used to raise federal contribution.
Total savings: $715 billion. Enrollment will drop at least 7.7 millions people from the current level of 71,000,000 people.
ENERGY & ENVIRONMENT - COMMUNICATIONS
Cancels funding of green-energy grant programmes in the 2022 Inflation Reduction Act. This includes vehicle manufacturing, home energy upgrades, electricity transmission and wind power.
Encourages pipelines, exports of natural gas and exploration.
Rejecting grant programs for electric heavy-duty vehicle purchases
Rejecting grants for reducing air pollution and greenhouse gas emissions.
Rejecting fuel efficiency standards for cars and pickup trucks
More electromagnetic spectrum bands available for communication.
The law prohibits the states from regulating artificial Intelligence.
Total savings: $197 billion
HOMELAND SECURITY
Cost of border wall construction: $46.5 billion
Cost: $6.3 billion for surveillance towers, drones, and border-security equipment
Cost: $6.2 billion. Increase the number of staff at U.S. Customs and Border Protection (Cost: 46,400 employees to 55,000).
Cost: $300 Million)
Total cost: $67 billion
IMMIGRATION & JUSTICE
Imposes new fees up to $5,000 on immigrants' work permits and court hearings.
The funding will be used to hire 10,000 additional immigration enforcement officers and fund 1 million deportations.
Additional funds are provided to government agencies for the investigation of visa fraud, criminal background checks, DNA testing and supervision of unaccompanied children.
The federal courts are prohibited from issuing contempt citations against the government for injunctions and temporary restraining order.
Total savings: $110 billion
MILITARY
Spending on shipbuilding to increase (Cost: 32 billion dollars)
Air and missile defence (Cost: 24 billion dollars)
Munitions (Cost : $19.5 billion).
Nuclear weapons (Cost : $12.6 billion).
Cost: $5 billion
Total cost: $144 billion
FOOD ASSISTANCE
Some of the 41 millions participants in the SNAP program will have to work more hours
In 2028, the federal government will begin to shift some costs to the states.
SAVINGS : $230 billion
EDUCATION
Changes to student loan repayment plans: Savings of $295 billion
Limits on borrowing for certain student loan programs
Restrictions on eligibility for Pell Grants
Limiting the government's capability to cancel student loans (Savings of $32 billion).
Total savings: $349 billion. (Reporting and editing by Andy Sullivan, Bill Berkrot Alistair Bell, Scott Malone and Andrea Ricci).
(source: Reuters)
