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Report: Trump Tax Plan Will Benefit Michigan's Richest

Cutting taxes and safety-net programs under the Trump proposal will likely increase economic inequality in Michigan. (cohdra/morguefile)
Cutting taxes and safety-net programs under the Trump proposal will likely increase economic inequality in Michigan. (cohdra/morguefile)
August 3, 2017

LANSING, Mich. – The Trump administration's tax proposals would not benefit all taxpayers or states equally, according to new analysis.

A report from the Institute on Taxation and Economic Policy finds the richest 1 percent of Michiganders would receive more than 53 percent of the state's tax cuts under the plan, with the poorest 20 percent of the state's residents receiving less than 1 percent.

Matt Gardner, a senior fellow with the institute, says that trend is echoed on a larger scale.

"Richer states tend to do better, poorer states tend to do worse - in a way that mirrors what's happening nationwide, with richer Americans getting the lion's share of the benefits and poorer Americans being comparatively left out in the cold," he points out.

Proponents of Trump's proposal say all Americans will see their taxes reduced, and maintain the move will boost revenues by stimulating economic growth.

Gardner disagrees, and notes the nation's top earners will get an average of $145,000 in tax breaks, compared with just $130 for the bottom 20 percent of earners.

Gardner adds there's no evidence to support the supply-side argument that tax cuts can pay for themselves. He says the tradeoff on nearly $5 trillion in lost revenues would likely be cuts in health care, education and food-assistance programs.

"Under any realistic view of the economic consequences of this plan, we're going to see larger budget deficits,” he states. “First on the chopping block would be federal aid to low-income Americans."

The White House also has proposed cutting SNAP benefits, the program formerly known as food stamps, by 25 percent over the next decade.

According to recent statistics, 70 percent of SNAP recipients are children, seniors and people with disabilities, and more than 20 percent work full-time, are caretakers or are enrolled in training programs.

Mona Shand, Public News Service - MI