Dan Celia is the president of Financial Issues Stewardship Ministries.
Dan believes the tax plan will pass and that even Senator McCain said he’d come back if his vote is needed. He suspects the vote will probably be before the end of the week with the president signing it over the weekend.
For all practical purposes, the Senate version prevailed. For instance, the House version had 4 tax brackets, the Senate had 7. The Senate repealed the individual mandate, the House had the mandate left in place. The Senate had a $2,000 child tax credit (The Senate won out on that point.) while the House had a $1,600 tax credit. Individual tax rates will expire in 2025. That was also from the Senate bill. The corporate tax rate is going to be made permanent.
The corporate tax rate cut in the House version was to take effect January 1, 2018, whereas the Senate wanted to put that off for a year. In the final version it’s going to be 21% taking effect this January 1.
Dan mentioned an expiration year of 2025 for tax reform cuts coming for average citizens. Where’s the pressure coming from not to make these permanent as is the case with corporate taxes? Wouldn’t our legislators want to make relief for average Americans permanent?
Dan expects this will get extended year by year by year so that they have the option at any time to raise taxes. He’s not sure where the pressure is coming from other than the Congressional Budget Office. He feels it works better in the long-term if the tax cuts are set to expire in 2025 and then as he noted, ‘…let’s see where we are with the expectations of maintaining just a 1.5 trillion dollar increase to the deficit.’
This program covered a lot of detailed ground as it pertains to this issue of the tax plan. Additional areas covered include:
–Where does the Johnson Amendment stand in all of this as it concerns churches and non-profits that get behind and endorse candidates? Is this a policy matter that shouldn’t be part of a tax reform package?
–What does Dan believe will happen to Obamacare now that the individual mandate is being removed?
–Dan commented on how the Obama administration did an amazing job of demonizing the idea of profits in corporate America, an idea that continues today. What were the results?
–Is Dan concerned about the market being overly inflated such that we could see a severe correction in the near future?