Skip to comments.No, Trump's budget does not contain a $2 trillion 'math error'
Posted on 05/24/2017 8:46:11 AM PDT by Sean_Anthony
The media fools telling you that simply don't know how the tax code works.
For the past 18 hours or so, the mainstream media has joined online lefty sites with the seemingly big news that the 10-year Trump budget plan contains a $2 trillion math error that makes the premise of the entire thing totally laughable. What theyre telling you is that the White House counted the same positive numbers twice - once assuming that economic growth would render tax rate cuts revenue neutral, and then counting the same economic growth as the cause of an entirely different $2 trillion in new federal revenue.
Even if you can assume the tax cuts will spur economic growth causing an additional $200 billion in revenue, the left and the media claim, the White House screwed up by counting that revenue twice when in fact it is only going to happen once.
And WHEN the tax cuts do BOTH?
Let’s see now:
1. The US cuts tax RATES, which leads to higher economic activity, which leads to higher economic growth.
2. The higher economic activity and growth lead to higher taxable income, which produces higher tax COLLECTIONS, even though tax RATES are lower.
3. Higher tax COLLECTIONS act to “balance” the theoretical lower tax COLLECTIONS which would result from a lower tax RATE and no growth.
So the media has demonstrated its economic ignorance once again...
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